Earthquakes and BC Stratas: Insurance, Deductibles and Planning

British Columbia's south coast is the most seismically active part of Canada, and earthquake coverage is one of the largest and most volatile lines in many strata insurance programs. Councils are often surprised twice: first by the premium, and then by the deductible. Here is how strata earthquake insurance in BC actually works under the Strata Property Act, and what a council can do about it before a claim happens.

What the strata corporation must insure

Under section 149, the strata corporation must obtain and maintain property insurance on:

• common property and common assets;
• buildings shown on the strata plan — so the policy is not limited to hallways and lobbies, it generally covers the original building including strata lots; and
• fixtures built or installed on a strata lot by the owner developer as part of the original construction (this one does not apply to bare land strata plans).

That insurance must be on a full replacement value basis, and must insure against the major perils set out in the Regulation, plus any other perils specified in the strata's bylaws (s.149(4)). The corporation must also carry liability insurance in at least the amount required by the Regulation (s.150).

Is earthquake coverage legally required?

It depends — and this is one to confirm, not assume. The Act does not name earthquake in s.149; it defers to the "major perils" list in the Strata Property Regulation and to any additional perils your own registered bylaws require. So the answer for your building turns on two documents: the Regulation's major-perils definition, and your bylaws.

Separately, section 152 lets a strata corporation buy insurance for perils and liabilities not covered by ss.149 or 150. In practice, that is where earthquake coverage sits for many BC stratas — a deliberate purchasing decision rather than an automatic inclusion. Ask your broker in writing whether earthquake (including sprinkler leakage and fire following a quake) is in your current policy, and at what sublimit.

Earthquake deductibles: the number that matters

Earthquake deductibles in the BC market are commonly expressed as a percentage of the insured value rather than a flat dollar amount, which means a mid-rise building can face a six- or seven-figure deductible. That is a market practice, not a statutory rule — your policy wording governs.

This is also why section 154 matters. The strata corporation must review the adequacy of its insurance annually, report on coverage at each AGM, and inform owners and tenants as soon as feasible of any material change in coverage, including any increase in a deductible. An earthquake deductible that jumps at renewal is exactly the change owners need to hear about promptly.

Q&A: who pays an earthquake deductible, and how?

Q: Is the deductible a common expense?
Yes. Under s.158(1), payment of a deductible on a claim against the strata's insurance is a common expense, contributed through strata fees calculated under s.99(2) or s.100(1).

Q: Can the strata charge it back to one owner?
Only in a different situation. Section 158(2) preserves the corporation's capacity to sue an owner to recover the deductible where that owner is responsible for the loss. Responsibility is not automatic, and a seismic event is not something an owner causes — so for earthquake damage the s.158(1) common-expense route is the realistic one. Where an owner genuinely is responsible for a loss, that owner's liability is their own, not a cost shared by unit entitlement.

Q: Do owners have to vote to approve paying the deductible?
No. Under s.158(3), despite any other section of the Act or regulations, strata corporation approval is not required for a special levy or a contingency reserve fund expenditure to cover an insurance deductible the strata must pay to repair or replace damaged property — unless the strata has decided not to repair or replace under s.159. That is a genuine exception to the usual 3/4-vote rule for special levies.

Q: What happens to the insurance payout?
Under s.156, the insurer pays the insurance trustee designated by the bylaws, or, if none is designated, the strata corporation to hold in trust. That money must be used to repair or replace without delay (s.157) unless owners decide otherwise by a 3/4 vote at a general meeting held no later than 60 days after the money is received (s.159).

What owners should carry

Owners cannot insure the corporation's deductible away, but s.161 lets an owner insure: their strata lot and original fixtures against perils the strata does not insure and for amounts in excess of the strata's coverage; non-original fixtures and improvements; loss of rental value beyond the strata's coverage; and liability. Councils can usefully remind owners — without advising them — to ask their own broker how their policy responds to a strata-wide assessment after a major loss.

Planning, not panicking

• Fund the reserve deliberately. Every strata corporation and section must budget a minimum annual contribution to the contingency reserve fund of at least 10% of the total budgeted operating fund contribution, determined after considering the most recent depreciation report (Budgeting and strata fees, gov.bc.ca). A large earthquake deductible is a good reason to budget above the floor.
• Know what seismic work would involve. Structural or exterior upgrades can be a significant change in the use or appearance of common property, which needs a 3/4 vote under s.71 in addition to the corporation's written approval — though no vote is needed where there are reasonable grounds to believe an immediate change is necessary to ensure safety or prevent significant loss or damage.
• Tie it into existing programs. Non-structural mitigation (anchoring tanks, bracing equipment, securing seismic gas shutoffs) belongs in your maintenance planning and work orders cycle, alongside fire and life-safety inspections at the intervals the BC Fire Code sets for each system.
• Think about evacuation realities. Post-event egress and shelter planning should account for owners with mobility, hearing or vision needs — see accessibility and the duty to accommodate.

Wading through a 60-page policy wording to find the earthquake sublimit is exactly the kind of task tools like SearchStrata are built for, using AI to surface the relevant clauses in strata documents. And because councils turn over, the policy history, broker correspondence and insurance resolutions should live with the corporation rather than in one treasurer's inbox — that continuity is what ManageStrata is designed to support, whether you self-manage or work alongside a property manager.

This article is general information about BC strata law, not legal advice; verify against the current Strata Property Act and Regulation or consult a BC strata lawyer.