Insuring an Illegal Suite

[Millions]

Hi,

I'm currently debating ideas with my parents for downsizing them. They are retired and living in a big 2-storey show home. We are thinking of buying a nice walk-out house and suiting the basement so they can have the basement and be close to us and our upcoming family.

Since re-zoning a single-family home in a suburb is near impossible, we will likely just go ahead and do it. It won't be causing any parking problems or anything.

But I've heard you CAN still insure it, despite being illegal for about 10% more than common insurance.

Is this true? Will insurance cover an illegal suite?

 

[Thomas Beyer]

What's the difference between a finished walk-out basement and an illegal suite ?

 

[Millions]

I think just having a stove makes it an illegal suite right? They would want their own kitchen, etc

 

[Courtney Hammond]

If it's a mother in-law suite it's different. I'm not sure where you are, but I would call your city and ask about requirements for in-law suites. In Edmonton I was told it isn't illegal if they are related to you, and have access to the whole house... Basically as Thomas pointed out- it just a finished basement with a kitchen.

The standards and legality are different if you are renting to public.

 

[Sherilynn]

As for insurance, it often doesn't matter if the suite is registered or not. What matters to most insurers is the suite is safe and all codes are met.

Talk to your insurance broker to confirm (in writing, preferably) the suite will be covered with your current insurance company. If it won't be, then consider changing companies. There are certain insurance companies that will look for reasons to deny a claim.

 

[Millions]

Awesome Thank you.

I will find out.

I am in Calgary fyi

 

[Matt Crowley]

Answers above are correct, to my knowledge.

You should be able to pull all electrical / plumbing permits to ensure the installations of the fixtures are safe. Installation of upgrades to your home is different than a development permit to develop a legal suite.

If you want insurance to bail you out in the event of a crises then tell them the truth.