Condo insurance is quite different from single family homeowners coverage. Whether you live in a high-rise building or a townhouse, condominiums present different challenges for hazard insurance coverage. Understanding the difference helps you purchase the right protection for your new condo home. Your condo insurance coverage should complement the "master insurance policy" purchased by your new homeowners association.
Master Condo Insurance Policy
Condominiums always have a master insurance policy covering the structure(s), open spaces, pools, tennis courts, outbuildings and liability for common areas in the development. The Homeowners Association purchases the master condo insurance policy and includes your portion of the premium, based on your pro rata share of ownership in the condo project, in your monthly homeowner dues (condo fees).
Condo association insurance protects you for hazards that occur throughout the entire project. Always examine the master insurance policy coverage before you commit to purchase a condominium, as the liturgy of homeowner association "errors" in the fiscal and insurance areas is long and sometimes problematic. Always verify that the condo association has excellent coverage at a reasonable price, for your own personal protection.
Also, be sure where condo association insurance "stops" and the point where your responsibility begins. Even the smallest misunderstandings could be costly to you. For example, some master policies protect the entire exterior of structures, but not the interior. You may need to include hazard insurance for your interior walls, floors and ceilings.
Condo insurance looks more like renters coverage than traditional homeowners insurance. Basic condo insurance protects all of your personal possessions, from clothing to major appliances. While the condo project master insurance policy covers injuries, accidents and multiple hazards for exterior events, you must insure against interior losses, including personal liability coverage.
As an example, your condo association insurance should have strong liability coverage that protects you should a guest suffer negligent injury in your parking lot, pool, tennis courts, or on the way to your front door. However, once your visitor steps inside your home, the burden shifts to you personally. Include sufficient liability coverage in your condo policy to protect your other assets should a major loss occur due to perceived negligence.
The key to getting the proper condo insurance quote is to perfectly "match" your coverage to the project master insurance policy. If you are unsure about how to achieve this goal, talk to an experienced insurance adviser or members of the condo association board of directors for clarification.
Examining the condo association insurance policy BEFORE you buy that new home is important. Should the homeowners association have less coverage than seems prudent or has encountered problems with claim reimbursement from their insurance provider, you may want to examine a different project that is better managed. Unlike insuring a single family home, which is your total responsibility to protect, owning a condominium involves the perfect combination of the project's master policy coverage and your condo insurance protection to keep you safe and secure.
To learn more or to get a FREE Condo Insurance quote, please contact us at 540.657.5633.