Hidden Damages. Not So Hidden Costs.
By: Dawit Kiflu, VP, Client Care, Samsonshield Inc.
At Samsonshield/Riskboss, we routinely speak with insurance providers and property managers who advise that insurance deductibles are increasing at an alarming rate. This is an attempt by some Boards to mitigate already surging insurance premiums for condominium corporations. In some condominium communities, the increases in insurance and deductibles are crippling the Board’s ability to manage budgets without large maintenance fee increases.
This is not a local phenomenon but is happening nationwide and likely in your condominium community.
Some insurance companies have limited certain types of claims in condominiums that have repeated incidents. Rarely, but it happens that some condominiums become uninsurable resorting to very expensive self-insurance strategies.
Section 89 of the Condominium Act requires condominium corporations to fix and repair common elements. Determining the cause of such damage can be problematic a best.
Damage deposits for moving rarely offset the cost for damages caused by movers who are often more interested in getting the job done quickly rather than focusing on safety and ensuring the quiet enjoyment of neighbours. Damage deposits don’t even come close to insurance deductibles, which is especially problematic for residents moving out when trying to recapture funds for damage.
The Burden to Security
Security guards have a multitude of things that they are responsible for, primarily the health and safety of residents and their guests. The dramatic COVID-related increase in parcel management has added greatly to this burden. It is unrealistic to expect that a security guard can do a pre/post inspection of move elevators and the loading bay and then follow movers throughout the building while performing their other assigned security duties.
Security would have to track the behaviour of movers. It includes loud yelling, smoking, monopolizing service elevators long past scheduled times, leaving site access doors unattended and open to trespassers, leaving unwanted furniture for the corporation to dispose of, and blocking hallways causing Ontario Fire Code violations. Additionally, there is unreported damage to hallways and other site areas.
When Damage is Found
Even with the best of intentions, residents and movers cause damage that they may not even be aware of. Post inspections are generally limited to service elevators and the loading bay, given time limitations of security guards providing for pre/post inspections. When incident reports of found damage are submitted, property managers are often faced with residents who challenge the validity of who caused it. Most incidents of damage in hallways are left undetermined.
In most cases, the damage is repaired and the corporation cannot recapture funds and the high cost of insurance ramifications.
Preventing Such Problems in the First Place
Riskboss has conducted independent and comprehensive risk assessments of over 65 condominiums in the GTA. Best practices have been collected through the years that improve risk mitigation for residents and guests.
A Move Guard Process is something routinely recommended by Riskboss to offset the labour-intensive and expensive task of determining liability for damages and holding people accountable.
And it’s not just about damage. Residents routinely call security, taking guards away from their duties to correct the misbehaviour of movers and the monopolization of service elevators past assigned times.
The cost of the Move Guard Process is minimal. A security guard is hired to directly monitor and oversee the move at a minimum of four hours. It is well worth it, as the costs are paid by incoming/outgoing residents and not the corporation.
In the decades that Riskboss has been recommending the Move Guard Process, there has never been one complaint by incoming/outgoing residents. Not one. This is because everyone understands the costs involved of not having such a process. and the benefits of having someone in a position of authority to monitor moves throughout the site.
The Move Guard Process has proven itself to be a very beneficial addition to condominium processes. Make it a part of your toolbox to offset risk and damages. You will be glad you did.