b.c. strata insurance 101 · b.c. strata insurance 101 the premise: premiums of the many pay the...
TRANSCRIPT
![Page 1: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/1.jpg)
B.C. Strata Insurance 101The Premise: Premiums of the many pay the losses of the few.
Chuck Byrne AIIC, IBABC Executive Director
![Page 2: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/2.jpg)
Insurance Brokers Association of British Columbia
SUPPLY
SUPPLY
DEMAND
DEMAND
![Page 3: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/3.jpg)
Insurance is subject to the forces of supply and demand.
SUPPLY
SUPPLY
DEMAND
DEMAND
Level or lower premiums
Rising premiums
![Page 4: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/4.jpg)
Factors Affecting Demand:
Inflation – including the impact on Total Insured Value (TIV)
New inventory/economy
Increasing repair and building costs – bylaw and code
![Page 5: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/5.jpg)
Factors affecting Supply:
• Investment capital
• Catastrophic losses
• Rising trends on climate and weather-related losses
Global factors
![Page 6: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/6.jpg)
Factors affecting Supply:
• Global Capital & Reinsurance
• Primary Insurers (CDN licensed)
• Free market/willingness to participate
• Niche or mix of risk appetite
High Level – Structure
![Page 7: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/7.jpg)
B.C. local conditions
Strata building and condo unit claims/accountability
Earthquake risk (supply/capacity)
Insurers exiting strata insurance market
Premiums historically low (10 years+), highly competitive
Insurers behind the curve: fast growth of strata sector, increasing construction and reconstruction costs
![Page 8: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/8.jpg)
Losses/ClaimsManagement:
• Aging infrastructure & delayed retrofit.
• The spread of risk dynamic (building vs unit).
• Strata Property Act (SPA) recommendations
– building vs. unit owner’s insurance coverage.
- Standard unit definition – (bare)
• SPA recommendations – unit owner insurance.
- Loss assessment cap – $50K?
![Page 9: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/9.jpg)
IssueManagement:
• B.C. Regulator (BCFSA/MoF) - Call for Data and review of environment.
• National Regulatory/Industry review planned and underway.
• “Work Ahead” strategy.
• Possible “Risk Pooling” initiative for uninsurable risks.
• Wood construction issues – wood high rises – code vs. desirability to insure.
![Page 10: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/10.jpg)
Risk Management: Universal
Strata Council
Unit owners/future owners
Building manager
Property manager
Insurance broker
Insurance company
![Page 11: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/11.jpg)
Risk Management:Schedule of Inspections
All water appliances
All hoses and plumbing
Smoke and CO2 detectors
Fire extinguishers and sprinkler systems
HVAC and all other building systems
![Page 12: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/12.jpg)
Risk Management: Technology
Water flow meters
Water leak detectors
![Page 13: B.C. Strata Insurance 101 · B.C. Strata Insurance 101 The Premise: Premiums of the many pay the losses of the few. Chuck Byrne AIIC, IBABC Executive Director](https://reader034.vdocuments.mx/reader034/viewer/2022042321/5f0af2467e708231d42e1e69/html5/thumbnails/13.jpg)
Thank you for this opportunity.
Chuck Byrne AIIC, IBABC Executive Director