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2024 Alberta Condo & Rental Insurance Update

Alberta’s Real Estate Insurance Market Forecast 2024-2025: Navigating Through a Transforming Landscape

As we advance into 2024, the real estate insurance market in Alberta—and indeed across Canada—displays significant transformations influenced by both global challenges and evolving local regulatory frameworks. This article explores what rental and condominium property owners can expect in terms of insurance costs, coverage, and market dynamics over the next two years, taking into account broader trends that could impact their insurance needs.

2024 Alberta Condo & Rental Insurance Key Market Trends

Increased Insurer Competition

Despite the backdrop of a hardening market where insurers are reassessing their portfolios amid various industry challenges, there remains a sense of optimism with an expected increase in competition among insurers into 2025. This trend might lead to more competitive rates and diverse insurance product offerings for property owners. According to BFL Canada, insurers are setting their sights on sustainable long-term growth with a focus on improving performance through careful risk selection and capacity placements​​. Considering the fluctuating market and general trends its always a good idea for policyholders to review their coverage carefully​.

Importance of Accurate Information

Given the rising inflation, which impacts the cost of covering claims, insurers emphasize the need for precise risk data and property valuations. This helps in better assessing and mitigating potential losses, especially in a market where reinsurance rates are also climbing. Property owners must therefore ensure that their coverage details are up-to-date and reflective of current property values to avoid underinsurance, a growing concern in today’s economic environment. BFL highlights the critical importance of providing quality risk information and accurate property valuations to offset inflationary increases​​. Lloyd Sadd underscores the risks of underinsurance as inflation drives up the cost of claims, making it essential for coverage to match the rising costs​1.

Impact of Natural and Cyber Catastrophes

The increasing frequency and severity of catastrophic events, such as wildfires, alongside heightened cyber threats linked to geopolitical tensions, reshape the insurance landscape dramatically. These factors necessitate robust coverage that can address complex claims, recovery processes, and potential cyber-related financial losses. The unpredictability of such events makes it crucial for insurers to accurately predict future risks, which could translate into increased costs for policyholders if not managed carefully. BFL’s2 report on natural catastrophe and severe weather events in Canada causing over $3.1 billion in insured damage in 2023 underscores the magnitude of these challenges​​. Additional insurers specializing in rental real estate and property management also point to the global rise in catastrophic weather events and cyber risks as key disruptors in the insurance market​.

Regional Focus: Alberta

Alberta’s Wildfire and Cybersecurity Readiness

In Alberta, the growing number and severity of wildfires, compounded by the risks of cyber-attacks, highlight the critical need for comprehensive insurance solutions that cover both natural and digital realms. Property owners are advised to review their policies to ensure they encompass adequate provisions for these risks, reflecting the dual threats of physical damage from fires and potential disruptions from cyber incidents.

Legal and Regulatory Updates

Alberta’s New Licensing for Condominium Managers

With new regulations requiring condominium managers in Alberta to be licensed as of October 2023, there is an increased emphasis on professional management and compliance with insurance standards. This change aims to enhance the quality of condominium management, directly impacting insurance practices and policy structures in the sector.

Looking Ahead: Recommendations for Property Owners

Given the evolving insurance landscape, property owners must engage in the renewal process early, providing detailed and accurate documentation. Understanding the implications of regional legal changes and adapting to new insurance market realities will be crucial in securing adequate coverage.

In conclusion, while the market presents numerous challenges, it also offers substantial opportunities for those prepared to adapt. By staying informed and proactive, property owners can not only manage their risks effectively but also leverage these insights to secure optimal insurance coverage in a dynamic market environment.

Commitment to Excellence in Property Management

In 2024, clients under our Emerald Management & Realty Ltd. Master Insurance program experienced minimal increases in insurance premiums, effectively managed by considering property values and current inflation trends. This careful balance reflects Emerald Management & Realty Ltd.’s ongoing commitment to providing outstanding insurance solutions in a challenging market.

As a locally owned and operated property management company located in Calgary, Alberta, Emerald Management & Realty Ltd. remains dedicated to assisting clients in navigating the complexities of the insurance market, ensuring optimal coverage at competitive prices. The evolving landscape of insurance, characterized by rising premiums and narrower coverage options, poses significant challenges to investment property owners and condominium boards. In response, our team continually updates its market knowledge to devise effective risk management and loss prevention strategies.

Over its 50-year history, Emerald Management & Realty Ltd. has cultivated strong partnerships with leading insurance brokers who possess an in-depth understanding of the market. These relationships, combined with proactive measures such as enhanced property inspections and educational initiatives on maintenance and upgrades, help mitigate risks and control insurance costs.

The cornerstone of our approach is the customized master insurance program, tailored for the managed properties. This program leverages Emerald’s substantial industry experience and buying power to secure preferred rates and comprehensive coverage for our valued clients. Even in the face of the industry’s ongoing challenges, our focus in 2024 has been on securing favourable corporate rates, manageable deductibles, and efficient claims management.

By staying informed and proactive about changing market conditions, Emerald Management & Realty Ltd. helps clients position their properties for success, reinforcing our commitment to delivering the highest level of service and support. To discover more about how Emerald Management & Realty Ltd. can support your investment objectives in this dynamic insurance market, please contact our team today.

2024 Alberta Condo & Rental Insurance Update

1 (Lloyd Sadd)​

2 (BFL Canada)

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