INSURANCE BUREAU OF CANADA Bulletin #AM96-04 60-AMPERE ELECTRICAL SERVICE, KNOB-AND-TUBE WIRING

IBCs Ontario Consumer Information Centre is receiving an increased number of inquiries where homeowners policies are being cancelled at renewal or individuals are unable to obtain new coverage in the regular market because of electrical wiring. This is a major concern for I.B.A.O. and the Ontario Real Estate Board as there are few alternative markets. Premiums in the substandard market are three or more times those of the regular market and coverage is usually more limited. Discussions with lAO., Ontario Hydro, Fire Departments, several licensed electricians, and electrical contractors confirm that 60-amp service and knob-and-tube wiring are not necessarily problems in themselves. They recommend inspection to ensure that the wiring is safe and adequate for the usage of the household. 60-amp Service There are even a few contemporary lower-cost housing developments with 60-amp service. The Canadian Electrical Code allows for 60-amp service in a single dwelling where the floor area excluding basement is less than 80 m2 (861.20 sq. ft.); otherwise, the single dwelling must have 100-amp service. It is not mandatory for older installations to be upgraded to this standard. Many dwellings of 1,200 sq.ft. or less built in Ontario in the 50s and 60s are equipped with 60-amp service Some of these have been upgraded to 100-amp service where only a new service panel was installed thus the wiring is no different then when the 60 AMP service was in place. Electrical contractors and electricians advise that upgrading to 100-amp service from 60-amp service in a smaller dwelling that has been checked by an Ontario Hydro inspector or qualified electrician provides little additional benefit but costs the consumer approximately $800+. There are other, more cost-effective ways to make 60-amp service safer; for example, a shunt can be installed so that only one major appliance such as a dryer or heat pump can operate at a time. Also, the substitution of circuit breakers for fuses can reduce opportunities for tampering or use of fuses rated above circuit capacity. Knob-and-Tube Wiring Knob-and-tube wiring comprises insulated wires clamped on two-piece porcelain knobs; positive and negative are carried separately. Hollow porcelain tubes carry the wires, through beams and other combustible materials. Modern electrical codes do not permit this type of wiring. It can present a hazard if tampered with, particularly at unenclosed, soldered-and-taped junctions. The unsheathed insulation is subject to deterioration, particularly where it is exposed, that is, not enclosed in a wall or ceiling. Worn insulation, of course, presents a shock hazard. Hydro inspections usually require all exposed knob-and-tube wiring to be replaced using approved permanent wiring material.

Insurance Bureau of Canada 181 University Avenue, Thirteenth Floor. Toronto, Ontario M5H 3M7 Tel: (416) 362.2031 Fax: (416) 361-5952 Representing private general insurance companies In Canada IBC Standard & Practices Committee

Bureau dassurance du Canada

In view of the public concern nationally, this item was on the agenda of its April 11, 1996, meeting. The Committee asked that a bulletin be issued recommending acceptance of 60-amp electrical service and/or knob-and-tube wiring provided that the wiring is inspected by a qualified electrical inspector or licensed electrician to ensure that the system is effective for the size of the dwelling and lifestyle of the occupants. Insurance Brokers Association of Ontario Canadian InsurancE-NEWS on May 6, 1996, reported IBAOs call for common sense in the evaluation and underwriting of homes with 60-amp service. IBAO researched the issue in response to a market withdrawal from such homes and found no statistical data to support concern. Ontario Hydro advised that only 4% of panel-board. fires occur in homes with 60amp service. Ontario Hydro also noted that a hazard may arise with any size of service when the circuit is overloaded and worn insulation on old knob-and-tube wiring may expose wires. Ontario Hydro encourages brokers and insurers to order electrical inspections to examine wiring conditions and circuit loads before refusing coverage. Recommendation It is recommended that insurance companies request a Hydro Certificate or documentation from a licensed electrician that the electrical service is safe and adequate for the life style of the household before refusing cover. The blanket refusal of some insurers to consider coverage for homes with 60-amp electrical service and/or knob-and-tube wing is causing concern, particularly as there is no evidence to justify such practice. Consumers should not unnecessarily be forced to seek coverage in alternate markets. Stan Griffin Vice President, Ontario