Part VI Insurance

(1) This Part does not apply to or in relation to the corporation of an estate development except in relation to improvements and buildings the common property of the estate development.

(2) Except as prescribed by the Regulations, this Part applies to a building management corporation and a reference to a corporation is to be taken to include a building management corporation.

(1) Subject to subsection (3), a corporation shall insure and keep insured all buildings and other improvements on the parcel for their replacement value from time to time against all the following risks:

(a) fire, lightning, tempest, earthquake and explosion;

(b) riot, civil commotion, strikes and labour disturbances;

(c) malicious damage;

(d) bursting, leaking and overflowing of boilers, water tanks, water pipes and associated apparatus; and

(e) impact of aircraft (including parts of, and objects falling from aircraft) and of road vehicles, horses and cattle.

(2) Subject to subsection (3), a corporation shall insure itself and keep itself insured against liability in respect of:

(a) death, bodily injury or illness; or

(b) loss of, or damage to, property,

occurring in connection with the common property as a result of an accident, for such aggregate amount of liability, being not less than the prescribed amount or, where no amount is prescribed, $2,000,000 at any one time, as is determined by the corporation.

(3) A corporation may, by unanimous resolution resolve that it will not insure against such of the risks referred to in subsections (1) and (2) as are specified in the resolution, and, in that event, the corporation is not required by this section to insure against a risk so specified.

(4) Where a corporation has, under subsection (3), resolved that it will not insure against a particular risk, a proprietor or mortgagee of a unit may at any time serve on the corporation a written notice requiring it to insure against that risk.

(5) 28 days after the receipt by the corporation of the notice, the unanimous resolution ceases to have effect in relation to the risk specified in the notice and the corporation shall, in accordance with subsection (1) or (2), as the case may be, insure against that risk.

(6) As soon as is practicable after the receipt by the corporation of the notice, the corporation shall notify every member and every mortgagee of a unit:

(a) of the particulars of the notice and the date of its receipt; and

(b) of the date on and from which the risk specified in the notice is, or is to be, covered by insurance effected by the corporation.

(7) Nothing in this section shall be construed as limiting the right of a corporation to effect such additional insurance as it determines.

(8) In this section risk includes any liability referred to in subsection (2).

For all purposes connected with any insurance effected by it under section 80(1), a corporation shall be deemed to have an insurable interest in the buildings and improvements on the parcel to the extent of their replacement value.

The moneys received by a corporation under a policy of insurance effected by it under section 80(1) in respect of any buildings or other improvements on the parcel shall not be liable to be brought into contribution with moneys received under any other policy of insurance except another policy effected under that subsection in respect of the same buildings or improvements.

A corporation shall, on the written request of a member or the mortgagee of a unit, produce for inspection by the member or mortgagee the policy of insurance effected by the corporation and the receipt for premiums paid under that policy.

Where the estate or interest of the proprietor of a unit is subject to a mortgage, the proprietor may effect one or more policies of insurance that indemnify him against liability under the mortgage, being liability arising out of damage to, or destruction of, the unit.

Where a policy of insurance is in force under section 84, the insurer is liable to pay to the mortgagee whose interest is noted on the policy or, if there are 2 or more such mortgagees, to those mortgagees in their order of registered priority:

(a) the sum insured as stated in the policy;

(b) the amount of the loss; or

(c) the amount sufficient, at the date of the loss, to discharge the mortgage noted on the policy,

whichever is the least amount.

Payment by the insurer to a mortgagee under section 85 does not entitle the mortgagor to a discharge of the mortgage, but, upon that payment:

(a) if the amount paid equals the amount necessary to discharge the mortgage, the insurer is entitled to obtain from the mortgagee a transfer of the mortgage; or

(b) if the amount paid is less than the amount necessary to discharge the mortgage, the insurer is entitled to obtain from the mortgagee a transfer of an undivided share of the mortgagee's estate and interest in the mortgage that bears to that estate and interest the same proportion as the amount paid bears to the amount that was owing under the mortgage immediately before the payment.

The moneys received under a policy of insurance effected in relation to a unit by the proprietor of that unit under section 84 shall not be brought into contribution with moneys received under any other policy of insurance except another policy effected under that section which indemnifies that person against liability arising out of damage to, or destruction of, that unit.

Nothing in this Part shall be construed as limiting the right of a proprietor of a unit to insure against damage to, or destruction of, the unit to the extent of its replacement value.

Subject to this Act and to any order of the Tribunal, where a corporation receives insurance moneys in respect of damage to, or destruction of, any building or improvement on the parcel, it shall, without delay, apply those moneys to rebuilding and reinstating the building or improvement.