What Is New Home Warranty?
New home warranty is an insurance protection product that protects your home from material, labour and structural defects that might arise after the commencement of warranty. The warranty stays with the home, whether you are the original owner or subsequent buyer and typically lasts for 10 years.
Is New Home Warranty Mandatory?
Alberta’s New Home Buyer Protection Act stipulates that all new homes must include warranty coverage of one year for materials and labour, two years for delivery and distribution systems, five years for building envelope and 10 years for major structural defects. As you look at homes and get to know the homebuilders in your community, consider the warranty carefully. You want to buy your home from a professional homebuilder with a solid reputation, excellent after-sales service and a third-party warranty provider.
Coverage Prior To Possession Optional Pre-Possession Insurance:
Pre-Possession Insurance is a combination of Deposit Insurance and Home Completion Insurance. This means in the event of default by a homebuilder, the purchaser’s investment is covered from payment of initial deposit under the purchase agreement and expires upon start of construction to a maximum of $100,000. Please confirm amount with your homebuilder. Home Completion coverage commences upon the start of construction and expires upon commencement of warranty to a maximum of $100,000.
1 YEAR Materials and Labour: Coverage for defects in materials and labour which include items such as flooring, paint and trim.
2 YEAR Delivery and Distribution Systems: Coverage for defects in materials and labour related to delivery and distribution systems including heating, electrical and plumbing systems.
5 YEAR Building Envelope: Coverage for defects in the building envelope, which is defined as the system of components that separate the controlled interior air from the exterior. For example, roof and exterior walls. OPTIONAL Additional Building Envelope: Coverage for defects in the building envelope for an additional two years. Only the homebuilder may opt for this coverage at the time of application.
10 YEAR Structural: Coverage for structural defects such as frame and foundation