1-2-5-10 Coverage
Alberta’s New Home Buyer Protection Act stipulates that all new homes must include warranty coverage of one year for labour and materials, two years for delivery and distribution systems, five years for building envelope protection and 10 years for major structural components. Following are more detailed explanations of these coverages, as well as warranty coverage limits and commencement dates.
1 Year Labour & Materials
Mandatory warranty includes one year’s coverage for defects in materials and labour. This addresses issues with the way your home was built or the materials it was built with. It includes such items as flooring, trim and fixtures. For a single-family home, a multi-family unit or multi-family common property, this coverage applies for one year starting on the warranty commencement date (see below).
2 Year Distribution Systems
A new home warranty must cover defects in labour and materials related to heating, electrical and plumbing systems for two years from the warranty commencement date. This applies to single-family homes, multi-family units and warrantable multi-family common property.
5 Year Building Envelope
Homebuilders in Alberta must provide five years’ coverage for defects in the building envelope, which the New Home Buyer Protection Act defines as the system of components that separate the controlled interior air from the exterior (for example, the wall framing and cladding, roof and window installation). This coverage spans five years from the warranty commencement date for a single-family home or multi-family common property. Warranty providers must offer an optional two-year extension on building envelope coverage for a total of seven years’ coverage.
10 Year Structural Integrity
The mandatory warranty covers the key structural components (for example, the frame and foundation) of single-family homes and multi-family dwellings for 10 years from the warranty commencement date. Coverage applies to defects in material and labour resulting in the failure of a load-bearing part of the new home or causes structural damage that materially and adversely affects the owners’ ability to use and safely occupy the home.
Living Expenses
If a new home is uninhabitable due to a defect or while warranty work is underway, the Program will pay up to $150 a day (to a maximum of $15,000) for reasonable living expenses incurred by the insured.
$265,000 Total Policy Limit
The total aggregate coverage for any single family home under the new legislation is $265,000. The Program believes their builders are the best in the industry, and they back them with the highest level of consumer protection.
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