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It is estimated that some 5 million American families live in condominiums. Condos can make living easier because much of the maintenance is handled by the community or homeowner association.
While a single-family homeowner owns the property, structure and contents of their home, a condo owner owns the space in which they live and its contents, but is not responsible for exterior maintenance. This distinction creates some important differences between insuring a condo and a single-family home or even an apartment.
A Brief Definition
Condominium insurance is an insurance policy that is taken out by the condo owner to protect his investment in a condo unit.
What It Covers
Generally, condo insurance covers the unit and its movable contents including furniture, electronics, clothing, housewares, bedding and more from covered perils. The condo unit is usually considered from the walls inward. Perils may include fire, theft, vandalism and natural disasters. It also provides liability protection in the event a visitor is injured while on the property under the control of the owner.
What is a Master Policy?
Condo owners are, to some degree, protected by an association’s Master Policy. The coverage on a Master Policy and consequentially on the unit owners’ policy are dictated by the By-Laws of the Association.This coverage generally only covers a condo from the brick or concrete outward along with common areas of the condo community. It may not cover drywall, plumbing, furnishings or anything in the interior of a unit. It also provides no protection from any liability claims made against a condo owner.
Loss Assessment Coverage
Many condo owners may falsely believe they don’t have any worries when it comes to external damage to their condo or if their association is sued by someone sustaining an injury. The problem is, the association may not have sufficient coverage to cover full damage or a liability claim may exceed the association’s limits. In some instances, where hurricanes caused severe damage to condominium communities, individual owners were assessed for the damages not covered by insurance. This can run into the tens of thousands of dollars. Condo Loss Assessment Insurance can provide additional coverage for owners against these additional charges that may be assessed.
Like homeowners’ insurance, condo insurance will likely be required by any bank or mortgage company that has financed a condominium. The homeowners’ association itself will frequently require it to protect the interest of other owners. If you currently live in, or are considering purchasing a condo, contact us for your no-cost, no-obligation condominium insurance quote. Our independent insurance agents will search multiple companies to find the coverage you deserve at a price you can afford. Contact us today.