Condominium Insurance covers loss to your condo or co-op unit resulting from things like burglary, fire, water damage (from leaky pipes), wind, hail, collapse, vandalism, and the like. It protects your personal property, unit interior, appliances, fixtures, alterations, and improvements. Condominium Insurance also protects you from liability should someone suffer an injury in your home.
Insurance for Condominium Units
Most condominium associations carry an association master policy to cover the building itself and all common elements of the condo, including things like elevators, stairwells, parking areas, the lobby, pools, fitness center, etc. Many condo owners mistakenly believe that their unit (and personal property) is covered under the association’s master policy. Most often, this is not the case.
Condominium Insurance is different from Homeowner’s insurance. Because only your unit itself is covered (not the structure itself), it tends to cost less than the typical Homeowner’s Policy. Essentially, condominium insurance coverage stops at the paint.
Condominium insurance is recommended for condo owners, not renters. Condominium renters only need to insure their personal property and their personal liability, not the unit interior, fixtures, appliances, and other items that stay permanently. Renters are thus better served by Renter’s Insurance.
Who Needs Condominium Insurance?
If you own a condominium unit or a share in a co-op, then you need Condominium Insurance. Pet owners who live in condos are particularly encouraged to get Condominium Insurance, as pets increase the likelihood of personal injury or property damage to someone else.
Considerations for Condo Owners
State laws dictate what is and what is not covered by the association’s master insurance. Therefore, before purchasing Condominium Insurance, carefully review your association’s policy to find out exactly what is and what is not covered.
You may qualify for a significant discount on your premium if you have up-to-date fire and safety devices like sprinklers, alarms, extinguishers, or a security system.
What happens if there’s damage to the condo building but your association doesn’t have adequate funds to cover it? In many cases, the condo owners will be required to help foot the bill. Some Condominium Insurance policies allow you to buy “loss assessment coverage” to protect against this.
Check to see if the policy has a “loss of use” clause to compensate you for a hotel stay should you have to live somewhere else while your unit is being repaired. Also check to see if the policy covers loss or damage to your personal property that occurs while you are away from your condo.
If you own any particularly valuable items (like jewelry, personal computers, business property, bicycles, electronic equipment, collectibles, etc.) you may be able to purchase a rider to cover these items for a much higher amount than would be the case with a basic Condominium Insurance policy.
Finally, make sure to tell your insurance agent if you have any pets. Some insurance companies will deny your claim if this isn’t stated upfront should your animal causes harm to another person or their property.