What Alberta New Home Warranty Covers and What It Excludes

You have found a problem in your new home and want to know whether the warranty applies. The answer depends on what the defect is, how old the home is, and what your warranty contract says.

This article explains what the mandatory warranty covers, how exclusions work, and how a claim generally proceeds in Alberta.

This article covers the law of Alberta.

What is covered

• Labour and materials, for 1 year: defects in materials and workmanship, such as flooring, staircases, baseboards, cabinets, railings, trim and fixtures.
• Delivery and distribution systems, for 2 years: electrical, plumbing, heating, ventilation and air conditioning.
• Building envelope, for 5 years: roof and walls.
• Major structural components, for 10 years: the frame, including roof structural integrity, and the foundation.

These are minimum periods. Warranty providers must offer builders the option to buy an extra 2 years of building envelope coverage. Coverage also has minimum rebuild limits of $265,000 for a single-family home and $130,000 for a condominium or other multi-family unit, based on the structure only and excluding land, contents and landscaping. Buyers can purchase more.

Common property in a multi-family project, such as elevators, lobbies, stairwells and the building envelope, has up to $3.3 million in coverage per building.

Which homes are covered and when coverage starts

The New Home Buyer Protection Act requires builders to provide home warranty coverage on all new residential homes, including condominiums, manufactured homes and recreational properties. It applies to homes where the building permit was applied for on or after February 1, 2014. The Act is SA 2012, c N-3.2, and it was created to improve residential construction quality, builder accountability and home owner recourse options.

Builders must make sure the home is enrolled with a warranty provider, that the coverage meets the legislated requirements, that they hold a residential builder licence, and that the home under warranty is registered.

Coverage starts at the earliest of the home being occupied, the permitting authority granting permission to occupy, or title transferring to the owner. For condominiums, coverage for units and for common property starts on the earlier of first occupancy or transfer of legal title, with separate policies for each. The start dates for common property may differ from those for individual units.

Coverage attaches to the home, not the owner. It stays in effect on resale until it expires.

How exclusions work

Exclusions from warranty cover are set by the Home Warranty Insurance Regulation and the warranty contract. Which common problems are excluded therefore depends on those documents, and on the facts of your home. Read your contract carefully or ask a lawyer to review it.

The Construction Performance Guide sets basic coverage requirements and recommended minimum performance expectations. It is not a comprehensive list, and an issue missing from the guide does not mean it is not a defect or that the warranty provider is not responsible for it.

Some homes are outside the warranty system altogether. The main examples are listed below.

• Renovations: renovators generally do not need a builder licence or warranty unless the renovation makes up 75% or more of the home as new construction. A relocated home that is 75% or more new construction is treated as a new home.
• Owner-built homes: an owner builder with a valid Owner Builder Authorization needs no builder licence or warranty for the home named in it. Qualifying homes are single-family, site-built homes for the owner's personal use, kept for at least 10 years. Duplexes, 4-plexes and factory-built homes do not qualify.
• Other buildings: the Act does not cover dormitories, care facilities, work camps or hotels, and does not apply to homes on federal lands such as First Nations reserves and National Parks. Multi-family rentals kept for at least ten years do not require warranty.

Even for an owner-built home, there is a limit. Within the 10-year protection period an owner builder cannot sell or offer to sell the home unless the required warranty has been purchased.

How to make a claim

A homeowner files a warranty claim by contacting the warranty provider. The provider explains its requirements, assesses the claim and works with the builder to resolve warrantable defects.

Before you call, check the coverage dates to confirm the issue is still within the period. The Property Registry shows your warranty provider, contact details and when coverage started. You can search it by civic address, lot/block/plan or builder. Specific notice deadlines depend on your provider's procedures and contract, so confirm them early.

If you disagree with the outcome

Claim disputes with a warranty provider are addressed by Guideline 05-2022, the New Home Warranty Insurance Claims and Claims Disputes Guideline (June 1, 2022), issued by the Superintendent of Insurance under Insurance Act s 792.1.

The Residential Protection Program can be reached at 780-644-1010 or 1-866-421-6929. If the contract wording or the outcome is unclear, it is worth having a lawyer review it with you.

What to do next

• Take dated photos and notes of the defect.
• Find your warranty provider and coverage start date in the Property Registry.
• Confirm the issue falls within the coverage period.
• Contact the warranty provider and follow its requirements.
• Keep copies of everything you send and receive.
• Speak with a lawyer if your claim is refused or the contract is unclear.

If you want to learn more about your builder, you can search the Builder Registry by builder name, builder ID, licence ID or location of homes built. It shows licence status and class, enforcement actions under the Act, and the number and locations of homes built since February 1, 2014. A builder who does not appear in the registry is not shown as licensed.

Frequently asked questions