April 12, 2018 11:30
Yves Joli-Coeur and Vincent Gaudreau | Photo : Paul Fournier
The fact that it is limiting to a reasonable threshold for the exemption for the syndicates of co-ownership, as provided in bill 150, could increase premiums, said Vincent Gaudreau, vice-president and broker at Gaudreau Insurance. But it all depends on the experience of loss and the ratio of losses, » he said.
«At the time, the ratio of loss of insurers in the market was around $ 1.50 in claims for every premium dollar. This was not at all profitable. They have taken steps to address profitability, and increasing deductibles is one of them, » explained Mr. Gaudreau at the symposium in spring of the Grouping of the managers and owners of Québec (RGCQ).
If the insurers are required to maintain deductibles that are reasonable, it still has two axes to achieve a certain degree of profitability, premiums and coverages. «After several years of losses in the segment, insurers have worked on two of the three axes, the premiums and the deductibles. The blankets are essentially remained the same. This has led to a phenomenon of franchises a little abusive and the trade unions were to take financial risks that were beyond their financial capability, » he added.
The bill 150 indicates that the union «shall purchase insurance providing for a deductible to be reasonable, against ordinary risks «and that» the government may provide, by regulation, the criteria under which a franchise is considered to be unreasonable.»
«What is a franchise reasonable ? We don’t know yet. The peculiarity of the bill 150 is that the provisions that amend the civil Code provide for freedom to the government to specialize and clarify some of the notions » stressed Yves Joli-Coeur, lawyer emeritus and founder of the RGCQ.
Comply with the financial capacities of trade unions
Me Joli-Coeur has also indicated that the amount of the deductible of the insurance must not be high at the point of match failure insurance. «However, we currently have situations where administrators, unions are forced, because of the historical claims in their co-ownership, purchase of insurance with deductibles, which represents a great importance on the finances of the condominium. «
«A deductible to be reasonable for a union of the two units is not the same for a union of 1000 units, was recalled by Mr. Gaudreau. A deductible of $ 100,000 for the first is unreasonable, as it is more reasonable for the second to the extent of the financial capacity of the union. «