A strata corporation in Kelowna is reviewing its annual insurance renewal. The council is concerned about rising premiums and suggests reducing the insured value to save costs. As the strata manager, what is your primary advice regarding strata corporation insurance coverage?

Question: A strata corporation in Kelowna is reviewing its annual insurance renewal. The council is concerned about rising premiums and suggests reducing the insured value to save costs. As the strata manager, what is your primary advice regarding strata corporation insurance coverage?

Answer options:

• Recommend reducing the full replacement value to save on premiums, as long as it covers at least 80% of the property's estimated value. ✅ Advise that the strata corporation must insure for the full replacement value of the buildings and common property, subject to reasonable deductibles.
• Suggest that obtaining multiple quotes from different insurers allows the strata to choose any policy that covers liability, regardless of building replacement value.
• Inform the council that insurance is optional for strata corporations with fewer than 10 units.

Correct answer: Advise that the strata corporation must insure for the full replacement value of the buildings and common property, subject to reasonable deductibles.

Explanation: Section 149(1) of the Strata Property Act mandates that a strata corporation must obtain and maintain insurance on the buildings and common property against full replacement value, subject to reasonable deductibles.