Insurance costs soar at tornado-battered condo

An Ottawa condo development's insurance rate has soared by nearly 730 per cent after a tornado and two fires, and the condo board's president says some residents won't be able to handle the extracost.

"Some people are suicidal," saidcondo board presidentMarie Weerasooriya-Epps."Some people are headed for nervous breakdowns."

Last year, the condo corporation behind Woodvale Green, a development of 110 townhouses offCraig Henry Drive, paid $26,858 for coverage.

But claims for a residential kitchen fire in January, damage caused by aSeptember tornado and an electrical fire in November led Carlton Condominium Corp. No. 188'sinsurerto drop them.

'The community has become much more difficult to live in'

6 years ago

Duration 1:09

Residents of a tornado-damaged condo development in Arlington Woods say they've been left with few options after their insurance premiums increased.

The next insurer willing to take on the risk for the lowest price was Lloyd's of London. The 300-plus-year-old boutique underwriter of ocean cargo and fine art peggedthe condo development's new premium at $222,634.

The added cost is being passed ontoresidentsworkingout to an extra$1,800peryear for each townhouse.

The condo corporation'sdeductible also went upfrom $2,500 to $100,000.

Lloyd's of London did not respond to a request for comment as of deadline.

Families on tight budgets

Weerasooriya-Epps said someresidents live on tight budgets. She estimated that40 per cent of themwon't be able to afford the new insurance rate,and that it couldforce some to default on their mortgages.

"There's not a lot of people who make a lot of money,"Weerasooriya-Eppssaid.

David Campbell's condo was so badly hit by the tornado that the city evicted him.

Now, he and his partnerrealize that with the repairs still needed, a pricier insurance bill and a condominium reserve fund all but wiped out, their unit will be hard to sell.

They had planned to put their home on the market, and calledtheir turn of fortunea reminder of"how fragile things are." Campbelland his wife are now struggling to stay positive.

"We actually made a deal. Only one of us was allowed to collapse, mentally, at any given moment," he said.

3 'disasters' in 1development

Pat Ibeais a cleaner whose common-law partnerdied last year.

"How can I afford this?" she asked.

The tornado damaged much of her roof.Water then leaked into her ceilings and upstairs walls.Six months after the storm, there are still boards over her windows.

She's worried about the additional insurancecost.

"I'm just a low-income family, especially now I'm bymyself," Ibea said.

"This community has been devastated with three disasters," said Stephanie Hammond, another resident of Woodvale Green."It's very unfair.

"It has taken over all of us. And to imagine, six months after a devastation, people still aren't in their homes?"

Insurance rates based on likelihood of future claims

It may take five years before the condo development's claims history clears and main-street insurers are once again willing to take on Woodvale Green.

There is no formal oversight of property insurance in Ontario, both personal andcommercial, according to Pete Karageorgosofthe Insurance Bureau of Canada.

The rates are set byinsurance company employeeswho look at the history of a property as an indicator of the likelihood of future claims, he said.

"If you have a property that has multiple claims, multiple instances of damage that have been submitted to the insurance company, it's going to be difficult because it's going to be a higher risk," he said.

In a statement to CBCNews, the Financial Services Commission of Ontario said that "there are no requirements for insurance companies to receive approval of their underwriting criteria/rules and premium rates from [the commission]."