Warranty Enrollment

Home warranty insurance is provided by private-sector insurance companies approved by the provincial Financial Institutions Commission and meeting the requirements of the Homeowner Protection Act (Act). Minimum coverage and allowable exclusions for third-party home warranty insurance are set by legislation.

As a minimum, homes built by Licensed Residential Builders must have 2-5-10 year home warranty insurance - the strongest construction defect insurance in Canada. Coverage includes a minimum of 2 years on labour and materials (some limits apply), 5 years on the building envelope including water penetration and 10 years on the structure of the home. Coverage above and beyond the minimum 2-5-10 standard is available from one warranty provider. This is a 2-10-10 year warranty.

A letter of acceptance from a home warranty insurance provider is a condition of licensing for residential builders.

Authorized Home Warranty Insurance Companies

A list of warranty insurance providers as well as insurance brokers that market home warranty insurance on their behalfs is available.

Regulation of the home warranty insurance system

Home warranty insurance providers are regulated by the provincial Financial Institutions Commission (FICom). Insurance brokers that act on behalf of warranty insurance providers are regulated by the Insurance Council of B.C. The Homeowner Protection Office monitors the performance of the home warranty insurance system in accordance with the Act and regulations, but has no authority to regulate warranty providers or insurance brokers.

Working with the Warranty Provider

Residential builders will need to contact an authorized home warranty insurance provider or their authorized insurance broker under the following circumstances:

To obtain a letter of acceptance from a home warranty insurance company. This letter is a requirement of obtaining and maintaining a residential builder licence.
To arrange for warranty insurance for each new proposed home (unit) or residential building. The Licensed Residential Builder registers the new home(s) online and the warranty insurance company enrolls the home(s).
To arrange for inspections with the warranty insurance company throughout building process of the new home.
To notify the warranty insurance company of the construction completion of the new home and the initial occupancy date, in order to initiate the warranty insurance policy.
To remedy defects covered by the policy of home warranty insurance.

Acceptance of a Residential Builder and Proposed New Homes by a Home Warranty Insurance Provider

A letter of acceptance from a warranty insurance provider is a condition of licensing. The regulations set out the type of information the home warranty insurance company may request before accepting a builder for home warranty insurance. In general, the areas considered can include:

do financial resources match with the business plan?
is there sufficient business and building expertise as well as experience in the company?
does the past conduct of the applicant indicate good business practices, and undertakings will be carried on in accordance with all legal requirements?
what is the applicant’s after-sales service plan and capability?

In addition to receiving acceptance for home warranty insurance, each time a Licensed Residential Builder proposes to build a new home or project they must obtain approval for home warranty insurance on the proposed new unit(s). The regulations set out the information a home warranty insurance company may request before approving a proposed new home or project for warranty insurance. This can include:

financial resources for the construction of the proposed new home(s)
technical expertise and practical experience available
sufficient and appropriate personnel to perform the construction, and
review of the plans for the proposed new home(s).

View the Homeowner Protection Act and regulations for specific details on:

Standards of Coverage

The regulations set out the minimum standards of home warranty insurance coverage. A summary of this standard is as follows:

2 years for labour and materials

For other than common property, in the first 12 months any defect or violation of the building code that constitutes an unreasonable health risk or material damage
For strata common property, in the first 15 months any defects or violation of the building code that constitutes an unreasonable health risk or material damage
For the remainder of the first 24 months, major systems, detachment of or material damage to exterior materials or violation of the building code that constitutes an unreasonable health risk or material damage.

5 years for the building envelope

Defects in the building envelope including those that permit unintended water penetration such that it causes or is likely to cause material damage.

10 years for structural defects

Material and labour defects that result in the failure of a load bearing part of the home or any defects that materially and adversely affect the use of the new home for residential occupancy.

This summary is only intended to aid in the understanding of the minimum standards of coverage and does not replace or supercede the Homeowner Protection Act and regulations. Please refer to the Homeowner Protection Act and regulations regarding the Minimum Standards of Coverage.

2-5-10 Year Home Warranty bulletin

Other Warranty Insurance Conditions

For more information about warranty insurance conditions, view the following links to the regulations: