Old vs. New Home Warranty

New home warranty coverage and products changed on February 1, 2014. Below is a chart to help explain the differences between the new mandatory coverage and optional products, and the old warranty coverage.

Single-Family 

WARRANTY COVERAGE PRIOR TO POSSESSION (Single-Family)

 NEW

   Pre-possession Insurance (optional)*

  • Pre-possession Insurance is a combination of Deposit Insurance and Home Completion Insurance. This means that in the event of default by a Builder Member, the purchaser’s investment is covered from the time a deposit is made and ends upon the mandatory warranty commencement date. Purchaser deposits are insured for 20% of the total home price, excluding land, to a maximum of $100,000

 OLD

   Deposit Protection

  • The return of your deposit(s) up to 20% of the purchase price to a maximum of $100,000 is covered in the event of default by a Builder Member

   Builder Performance Protection

  • Coverage for up to $50,000 towards the completion costs or the discharge of builders’ liens in the event a Builder fails to complete the home as contracted
WARRANTY COVERAGE AFTER POSSESSION (Single-Family)

NEW

   1 year Workmanship and Material

  • Offers coverage for defects in materials and labour which include items such as flooring and fixtures for a period of one year starting on the warranty commencement date

   2 year Delivery and Distribution Systems

  • Offers coverage for defects in materials and labour related to delivery and distribution systems including heating, electrical and plumbing systems for a period of two years starting on the warranty commencement date

   5 year Building Envelope Coverage

  • Offers coverage against defects in the building envelope for a period of five years starting on the warranty commencement date

Additional 2 year Building Envelope (optional)**

Optional building envelope coverage protects purchasers from defects in the building envelope for an additional period of two years extending the coverage period to a maximum  of seven years from the warranty commencement date

   10 year Structural

  • Offers coverage against structural defects for a period of ten years starting on the warranty commencement date

   Warranty Coverage Limits

  • The coverage limit is the lesser of the purchase price paid (excluding land) and $265,000

   Additional Living Expense Protection

  • If a new home is uninhabitable as a result of a defect or during the rectification of a defect, then reasonable living expenses incurred by the insured will be payable by the Program to the insured to a maximum of $150 per day (not to exceed $15,000)

OLD

   First Year Workmanship & Material Protection

  • If the Builder Member does not meet its warranty obligations, the Program provides for up to $100,000 in costs to repair defects in Workmanship and Material during the first year after possession

   5 Year Structural Integrity Protection

  • The unused portion of the First Year Materials & Workmanship warranty coverage amount, up to $100,000, can also be applied to the costs to repair major structural defects affecting the load bearing components of the home in the first five years

   Additional Living Expense Protection

  • While warranty work is being completed in the home, the homebuyer may incur incremental excess living costs. The Program will reimburse the homebuyer for up to $6,000 in pre-approved, verifiable living expenses over the span of your coverage

 

 

*Pre-possession Insurance (optional) – this is an optional product offered by The Alberta New Home Warranty Program but not mandated by the government to be offered

**Additional 2 year Building Envelope (optional) – only the Builder Member may opt for this coverage at the time of project application

 

Multi-Family

WARRANTY COVERAGE BEFORE POSSESSION (Multi-Family)

NEW

   Deposit Insurance (optional)*

  • Purchaser deposits are insured for 20% of the total home price excluding land to a maximum of $50,000**. This means that in the event of default by a Builder Member, the purchaser’s investment is covered from the time a deposit is made and ends upon the warranty commencement date***

OLD

   Deposit Protection

  • Coverage for the deposit amount or up to 15% of the purchase price, whichever is less, to a maximum of $30,000

 

WARRANTY COVERAGE AFTER POSSESSION (Multi-Family)

NEW

   Unit Protection:

   1 year Workmanship and Material

  • Offers coverage for defects in materials and labour which include items such as flooring and fixtures for a period of one year starting on the warranty commencement date

   2 year Delivery and Distribution Systems

  • Offers coverage for defects in materials and labour related to delivery and distribution systems including heating, electrical and plumbing systems within the unit for a period of two years starting on the warranty commencement date

   Unit Warranty Coverage Limit

  • The lesser of the purchase price paid (excluding land) or $130,000****

   Warrantable Common Property Protections:

   1 year Workmanship and Material

  • Offers coverage against defects in materials and labour in the common property for a period of one year starting on the warranty commencement date

   2 year Delivery and Distribution Systems

  • Offers coverage for defects in materials and labour related to delivery and distribution systems including heating, electrical and plumbing systems for a period of two years starting on the warranty commencement date

   5 year Building Envelope Coverage

  • Offers coverage against defects in the building envelope for a period of five years starting on the warranty commencement date

Additional 2 year Building Envelope (optional)*****

  • Optional building envelope coverage protects purchasers from defects in the building envelope for an additional period of two years extending the coverage period to a maximum  of seven years from the warranty commencement date

   10 year Structural

  • Offers coverage against structural defects for a period of ten years starting on the warranty commencement date

   Common Property Warranty Coverage        Limits

  • For warrantable common property in a multi-family dwelling, or for the property for which a condominium corporation is responsible under its bylaws, the lesser of $130,000 (excluding land) times the number of single dwelling units in the condominium or multi-family dwelling to a maximum of $3,300,000

   Additional Living Expense Protection

  • If a new home is uninhabitable as a result of a defect or during the rectification of a defect, then reasonable living expenses incurred by the insured will be payable by the Program to the insured to a maximum of $150 per day (not to exceed $15,000)

OLD

   First Year Workmanship & Material Protection

  • If the Builder Member does not meet its warranty obligations, the Program provides for up to $60,000 per unit in costs to repair defects in Workmanship and Material during the first year after possession subject to a limit of the lesser of $60,000 per unit or $1,500,000 for the project

   5 Year Structural Integrity Protection

  • The unused portion of the First Year Materials & Workmanship warranty amount, up to $60,000 per unit, can also be applied to the costs to repair major structural defects affecting the load bearing components of the home in the first five years subject to a limit of the lesser of $60,000 per unit or $1,500,000 for the project

   Additional Living Expense Protection

  • While warranty work is being completed in the home, the homebuyer may incur incremental excess living costs. The Program will reimburse the homebuyer for up to $6,000 in pre-approved, verifiable living expenses over the span of your coverage

 

*Deposit Insurance (optional) – this is an optional product offered by The Alberta New Home Warranty Program but not mandated by the Government of Alberta to be offered

**Project specific and may fluctuate. Confirm amount with your builder

***Commences upon payment of initial deposit under the purchase agreement and ends upon unit mandatory warranty commencement date

****Coverage limit for a unit registered under a condominium plan

*****Additional 2 year Building Envelope (optional) – only the Builder Member may opt for this coverage at the time of project application

This document is provided for information purposes only and may be amended from time to time (January 31, 2014)