What is home owners warranty insurance

what is home owners warranty insurance

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The Homeowner Protection Office, which now operates as a branch of BC Housing. provides consumer protection information for homeowners:

Home Warranty Insurance on New Homes

Homes built by Licensed Residential Builders are covered by mandatory, third-party home warranty insurance. As a minimum, this coverage includes 2 years on labour and materials (some limits apply), 5 years on the building envelope and 10 years on structure. It's the strongest construction defect insurance in Canada. Some homes have home warranty insurance that exceeds this minimum requirement. The HPO's Guide to Home Warranty Insurance in British Columbia provides owners and prospective homebuyers with information about home warranty insurance in B.C.

The warranty is attached to the home, not to the owner of the home, and remains in effect upon the re-sale of the home until the coverage expires.

Strata-titled homes have two policies of home warranty insurance, one on the home and another on the common property. When the coverage of a new strata-titled home commences, it is possible that the coverage on the related common property has already commenced or expired. Coverage on the common property of strata-titled buildings starts when the first unit in the building is occupied or sold.

More information about home warranty insurance:


Owners of homes with home warranty insurance could limit their coverage as a result of negligent or improper maintenance to the home. Builders/warranty providers have a responsibility to provide maintenance information to the original buyers of a home, if they want to make home warranty insurance coverage conditional upon proper maintenance.

The Homeowner Protection Act regulations detail the consequences of the builder/warranty provider not providing information:

Owners of strata-titled homes also have a legal obligation to maintain the strata property. The Strata Property Act which is administered by the Province's Office of Housing and Construction Standards details these obligations.

The Homeowner Protection Office has developed a series of maintenance bulletins entitled Maintenance Matters. These bulletins provide practical information on the maintenance of the building envelope of multi-unit residential buildings.

Maintenance Matters bulletins are for anyone who lives in or looks after a multi-unit residential building, including residents/unit owners, strata councils, housing cooperatives, maintenance managers, property managers and building owners.

Start by watching our free Maintenance Matters videos. Developed as companion pieces to the bulletin

series, these videos provide helpful maintenance tips. Check out the bulletins for more helpful information on the following topics:

Owner-built Homes

An owner-built home is a single detached dwelling constructed by a person that is neither required to be licensed by the Homeowner Protection Office nor required to arrange for home warranty insurance on the new home because the individual is building the new home for their own personal use.

Unless home warranty insurance is provided, owner-built homes are subject to the 10-year Statutory Protection provisions of the Homeowner Protection Act. These provisions hold the owner builder personally responsible to subsequent purchasers for any defects in material, labour or design for 10 years after first occupancy.

Owners wanting to rectify defects must contact the owner builder directly. Any action by a purchaser under this section of the legislation must be commenced within the 10 year period.

Repair Warranty Insurance on Completed Building Envelope Renovations

Building envelope renovations applicable to the Homeowner Protection Act regulations are performed by building envelope renovators licensed by the Homeowner Protection Office who arrange for third-party repair warranty insurance.

Minimum coverage for warranty insurance covering applicable building envelope renovations is set by regulation, not by warranty providers.

The coverage includes 2 years on labour and materials (some limits apply) and 5 years on the building envelope including water penetration (2-5 year warranty insurance).

More information about warranty insurance for building envelope renovations:

  • Highlights of the Building Envelope Renovation regulations
  • Summary of amendments to the Homeowner Protection Act regulations - July 28, 2004
  • View the Homeowner Protection Act regulations for building envelope renovations .

Some areas of interest include:

Warranty Insurance Claims

Upon the discovery of a potential construction defect and before the expiry of the applicable home warranty insurance coverage, owner/holder must provide written notice to the warranty provider and the Licensed Residential Builder/Licensed Building Envelope Renovator.

Owners/holders have a duty to mitigate damage.

Warranty providers are required to handle claims as detailed in the regulations.

An owner can exercise their right to compel their warranty provider to a mandatory mediation session. The mediation process is performed independently of the Homeowner Protection Office.

The HPO retains a list of warranty providers approved by the Financial Institutions Commission.

Source: www.hpo.bc.ca

Category: Insurance

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