When purchasing a new home in British Columbia, buyers gain not only a property but also peace of mind, thanks to the mandatory 2-5-10 Year Home Warranty Insurance. This warranty, introduced under the Homeowner Protection Act, provides comprehensive protection against common defects and structural issues. Here’s a closer look at what it entails.
What is 2-5-10 Year Home Warranty Insurance?
The 2-5-10 Home Warranty Insurance ensures new homes are built to a standard that protects buyers against unforeseen defects. This policy, effective since July 1, 1999, is mandatory for all new homes in BC built with permits issued after this date. Builders must be licensed by BC Housing and the insurance must be provided by approved companies.
Coverage Highlights:
2 Years: Labour and materials (some limits apply).
12 months for detached homes and non-common strata property.
15 months for common strata property.
24 months for delivery systems (e.g., electrical, plumbing, HVAC).
5 Years: Protection against building envelope failures, including water penetration.
10 Years: Coverage for structural defects.
When Does Coverage Begin?
Coverage commencement depends on the type of property:
Custom Homes: The first date of occupancy or the occupancy permit, whichever comes first.
Spec Homes: The first date of occupancy or the legal title transfer date.
Strata Homes:
Individual Unit: First occupancy or title transfer date.
Common Property: The first unit’s occupancy or the building’s title transfer date.
Why is it Beneficial?
Buying a new home in BC comes with the assurance that your investment is protected against potential risks. From covering major defects to addressing smaller issues like material flaws, this warranty provides financial and emotional relief, ensuring long-term satisfaction.
Are There Any Exclusions?
While extensive, the warranty does not cover:
Landscaping and non-residential structures.
Normal wear and tear or material shrinkage.
Damage from non-residential use or owner’s negligence.
Acts of nature, such as earthquakes or floods.
To clarify specific scenarios, homeowners can refer to BC Housing’s Residential Construction Performance Guide.
Claim Limits:
Detached Homes: The lesser of the first owner’s purchase price or $200,000.
Strata Units: The lesser of the first owner’s purchase price or $100,000.
Strata Common Property: $100,000 per dwelling or $2.5 million per building.
BC Housing Contact Information for me details:
For full details and guidance, buyers can contact BC Housing’s Licensing & Consumer Services:
Phone: 604-646-7050
Toll-Free: 1-800-407-7757
Email: licensinginfo@bchousing.org
Final Thoughts:
The 2-5-10 Year Home Warranty Insurance is a key advantage of purchasing a new home in BC. It safeguards your property investment and provides a safety net against unexpected issues, ensuring your dream home truly becomes your haven.
Written by Saleem Nashef
Realtor at Westmont Reality
+1 778 239 3566
saleem_alnashef@hotmail.com
Reference: BC Housing - Regulatory Bulletin 3: 2-5-10 Home Warranty Insurance
