Bill 209 2009

An Act to amend the Residential Tenancies Act, 2006 with respect to landlords' obligation to provide rental insurance

Note: This Act amends the Residential Tenancies Act, 2006.  For the legislative history of the Act, see the Table of Consolidated Public Statutes – Detailed Legislative History at www.e-Laws.gov.on.ca.

Her Majesty, by and with the advice and consent of the Legislative Assembly of the Province of Ontario, enacts as follows:

   1.  The Residential Tenancies Act, 2006 is amended by adding the following section:

Landlord's responsibility re insurance

   20.1  (1)  A landlord is responsible in respect of all residential complexes containing five or more rentals units for obtaining and maintaining an insurance policy for,

  (a)  damage to the entire residential complex, including the common areas of the residential complex and the exterior of the residential complex; and

  (b)  damage to each individual rental unit, including the tenant's personal property.

Insurance premiums to be included in rent

   (2)  A landlord shall calculate the insurance premiums for each individual rental unit, and the insurance premiums shall be included in the amount charged to the tenant as part of his or her rent.

Insurable interest

   (3)  A tenant who is not exempt under subsection (7) from the landlord's rental insurance shall have an insurable interest in his or her individual rental unit, including his or her personal property within the rental unit.

New tenancy agreement to indicate cost of insurance premiums

   (4)  A tenancy agreement entered into after this Act comes into force shall indicate an estimate of the cost of the insurance premium included in the cost of rent.

Existing tenancy agreement

   (5)  If a tenancy agreement was entered into before this Act came into force, the landlord shall indicate the cost of the insurance premium in the same manner and at the same time as a notice of rent increase under this Act.

Increase in cost of premiums

   (6)  Despite any changes in the landlord's insurance premiums, the landlord shall calculate the rent increase as the sum of:

  (a)  the guideline in subsection 120 (2) applied to the amount of rent charged in the previous year, excluding any insurance premiums; and

  (b)  the cost of the insurance premiums for the current year as determined by the insurance company.

Tenant may be exempt

   (7)  A tenant is not required to pay the premium indicated in his or her tenancy agreement if he or she has submitted proof to the landlord in the prescribed form that he or she has obtained comparable insurance.

Reduction of rent

   (8)  A tenant who has obtained his or her own insurance is entitled to a reduction in his or her rent equal to the amount of the insurance premiums described in the tenancy agreement.

Landlord shall pay insurance premium

   (9)  A landlord shall pay the required insurance premium from the first day a tenant occupies a rental unit until the earlier of the day the tenant no longer occupies the rental unit or an order evicting the tenant is executed.

   2.  Section 233 of the Act is amended by adding the following clause:

(a.1) fails to pay a required insurance premium related to the tenant's rental unit in contravention of section 20.1;

   3.  Subsection 241 (1) of the Act is amended by adding the following paragraphs:

11.1 prescribing the content and scope of the required landlord's insurance for the residential complex and each individual unit;

11.2 prescribing the rules governing the conditions under which a tenant may claim an insurable interest in his or her rental unit or personal property and the process for making that claim;

11.3 prescribing the conditions under which a tenant is not required to pay the landlord's rental insurance premiums and the process for obtaining that exemption;

Commencement

   4.  This Act comes into force six months after the day it receives Royal Assent.

Short title

   5.  The short title of this Act is the Residential Tenancies Amendment Act (Rental Insurance), 2009.

EXPLANATORY NOTE

The Bill amends the Residential Tenancies Act, 2006 by creating an obligation for every landlord to obtain and maintain insurance for every residential complex containing five or more rental units and to obtain and maintain insurance for the tenant's personal property within each rental unit.  The insurance premiums for each individual unit are added to the rent of the tenant thereby creating an insurable interest.  A tenant may be exempt from paying the insurance premiums as part of his or her rent if proof of alternate insurance coverage is provided to the landlord in the prescribed form.