When purchasing insurance for the building, the syndicate of co-ownership must ensure that the amount of coverage for the building corresponds to the real cost of rebuilding it. This amount must be sufficient to cover the entire building, with the exception of improvements made by individual co-owners. In other words, there must be sufficient insurance to restore the building to the same condition as it was when it was first built.

It is not the role of your insurance broker to determine the coverage required to insure the entire building: he is not qualified to do so. You must have this important calculation done by a professional evaluator. When you hire this expert, you should mention that you want to obtain a reconstruction value assessment for insurance purposes since there are several types of valuations and not all have the same purpose.

The reconstruction value of your building includes, in addition to the cost of materials and labour required, the fees of professionals (architects, engineers, etc.), the cost of bringing the building up to standard so that it meets the most recent construction requirements, the cost of permits, taxes, debris removal fees, etc.

In some cases the declaration of co-ownership will specify that a new assessment must be obtained before each renewal of insurance, others will require a new assessment be done before purchasing insurance from a new insurer. The law, for its part, now requires that you obtain a new evaluation of your building at least once every 5 years (article 1073 of the Q.C.C.).

Most insurers will increase, on a year to year basis, the amount insured to keep pace with inflation. This way, if a new valuation is not done each year, the insurer will keep your insurance amount as close as possible to the real reconstruction value of the building. But this calculation is not an exact science and does not replace a professional evaluation. It does not take into account any modifications and/or renovations you may have made to the building that may have increased its value.

Replacing a roof, for example, will not increase the reconstruction value of your building since the evaluation already takes into account the replacement of the roof with similar materials. However, if you choose different roofing materials, or if you are expanding the building, a new assessment may be required and your broker can help you determine if it is necessary.

In any case, always notify your broker before the work begins: he or she can ensure that you are well covered for the duration of the work or suggest additional protection, if necessary.

Chantal Chartrand
Damage insurance broker
Specialist in condominium insurance