Municipal Affairs and Housing Minister Selina Robinson is oozing empathy for condo residents getting hammered by insurance companies on their strata insurance policies.
But that’s about all she’s got. In terms of actual relief from the stunning rate hikes being imposed, all she can do is cite a piece of new legislation that tackles bits and pieces of reforms over an extended period of time.
As the legislature resumed sitting on Monday, it was clear off the top that the government is in as big a jam as residents are when it comes to responding to the condo insurance crisis.
Opposition Liberals rounded up a fresh new round of horror stories was brought to Robinson’s attention. But all she had to offer were some new measures in the bill that would make a marginal difference at best.
• Leanne O’Grady heads a strata council of 57 row houses in Penticton, which is grappling with a jaw-dropping hike in their insurance premium. It was $20,000 last year and this year, the only quote they could get was from a company that will charge $179,000.
She said they have no viable options to cope with that kind of hike.
• A Ladner complex got word on New Year’s Eve there was no company willing to insure their building. They finally found one that charged 310 per cent more than last year.
• A Coquitlam strata saw the premium double, which added $115 a month more to the maintenance fee. The water damage deductible went from $15,000 to $150,000.
Liberals quoted one senior resident: “How am I supposed to enjoy retirement when I don’t have any money?”
There was also word that a Richmond complex was denied insurance entirely, solely because of the earthquake risk.
A broker is reportedly dealing with several other complexes there in the same dilemma.
The cascading effects of those situations on mortgages and resale values could potentially widen the scope of this crisis considerably.
The Opposition is sharpening its focus on the problem because the concerns keep pouring in.
It’s also demanding direct government help for condo owners, which could turn into a very complicated proposition.
Some Liberals have admitted publicly there’s no one single solution and even their ideas to date wouldn’t make the problem go away.
Those ideas include waiving the four per cent tax charged on insurance premiums, a tax that will bring in vastly more revenue this year than it has in the past.
Robinson quoted the Liberals admissions back to them on Monday. It was nice to see both parties in agreement. But dismaying to realize the thing they agree on is that the situation is almost hopeless.
She also cited various ideas in the bill introduced last month that purport to address the problem.
One section bans referral fees from insurance companies to property managers, something flagged in an independent report by a condo association.
(An experienced property Victoria manager advised me they had never heard of this before and after consulting widely, found only one instance of such a thing, at Whistler. That firm had to advise all clients it’s never had anything to do with referral fees.)
Robinson said she was shocked to learn of referral fees — a.k.a. kickbacks. But they might be so uncommon that curbing them won’t make much of a difference.
She defended the bill as an effort to round up good ideas from all quarters, even the Opposition, and make them law.
And she stressed the Financial Service Authority’s conclusions in an interim report: “There are no quick fixes.”
“We recognize that we have some work to do,” she said.
The bill will “help mitigate some of the challenges … so people can rest assured that there is a government that has their interests at heart.”
It’s a badly needed start on several reforms, but it doesn’t make a dent in gigantic premium hikes.
One section allows boards to dip into reserve funds to cover a broader range of costs — such as sudden huge hikes in their insurance premiums.
But O’Grady, in Penticton, said their reserve would be almost entirely consumed paying this year’s premium.
She said the bill “ is promising more promises in the future.
“It’s not much help right now.”