A Crown corporation that regulates British Columbia's private-sector insurance companies says an average 40 per cent increase in condo insurance premiums resulted from various factors including risks that insurers face from earthquakes and flooding.
The BC Financial Services Authority says risks related to catastrophic events, some involving climate change, have put additional pressure on insurance companies' profitability, impacting premiums and deductibles in parts of Canada and globally.
However, it says in a final report that the issues involved are complex and there are no simple solutions, so consumers should not expect short- or medium-term relief from further price increases.
Frank Chong, the corporation's vice-president of regulations, says Alberta's condo insurance market has also been heavily affected, and claims costs must be lowered.
The report does not contain recommendations on how the B.C. government should address issues that are impacting housing affordability through higher monthly strata fees and deductibles.
Provincial legislation introduced earlier this year will end a practice called best terms pricing as of Jan. 1, where several insurers would bid on policies and instead of picking the average cost, the highest price bid would be set as the premium.
