People live in different types of houses. Some stay in condos, and some reside in townhouses and independent homes. Typically all homes have the same type of insurance cover. Yet, when it comes to condominiums, the insurance cover differs due to this type of housing’s uniqueness. As a result, there is a lot of confusion regarding condo insurance. Allow us to make things clear to you.
Condos Are Unique
As we said, a condo is unique. Some areas are public, belonging to all the residents of the condo complex and the living unit itself is private property belonging to the condo owner. Therefore, two types of insurance come into play. The residents need to purchase Condo Insurance for the private living quarters, while the Condo Association Insurance covers the public areas.
Condo insurance is also known as “HO-6 insurance policy” or “Walls-in Coverage.” They protect only your housing unit. A typical condo insurance policy will provide:
1. Personal liability coverage.
2. Living expense coverage if the condo becomes uninhabitable.
It does not provide any protection against floods. For that and other such situations, you may need to buy additional cover.
Things Covered By Condo Insurance Policy
Every condo insurance plan has a few standard coverages. Here’s a list of them:
1. Personal Liability Coverage – Family, friends, acquaintances, and sometimes even other people come to your condo. It could be for pleasure or work. The reason does not matter. If they suffer an injury while on your premises due to some fault of yours, the personal liability coverage will come into play. It will allow you to pay for the injured party’s medical expenses and the related legal bills.
2. Building Property Protection – This coverage will make it easy for you to pay for repairs of your condo unit’s walls or other interiors. The important thing to keep in mind is that the damage is covered only if it has been caused by a peril covered by your insurance policy.
3. Guest Medical Coverage – Sometimes people may get hurt while in your condo for no fault of yours. Guest medical coverage will still allow you to take care of the injured party’s medical expenses.
4. Personal Property Coverage – Personal property is your belongings like clothes, appliances, electronics, and furnishings. If they get damaged or stolen, insurance will help you pay for their repairs or replacement. Although the amount you will get depends on whether you chose the Actual Cash Value (ACV) option or the Replacement Cost Coverage option. The thing of importance here is that in both cases, three will be a limit. It means the maximum payout is capped, and you cannot get more than that.
5. Loss Of Use – If the damage to your condo is such that you cannot use it and have to live elsewhere while the repairs are being done, you can claim financial assistance under loss of use from your insurance company. Typically, it will cover your lodging and transportation expenses. If, say, your house is still livable, but the kitchen has suffered the brunt of the damage and rendered unusable, you can claim for eating out.
Things Covered By Condo Association Coverage
The condo association insurance policy is also known as the master policy. Typically, it will cover all the common areas like the swimming pool, boiler room, hallways, roof, etc. In short, it will cover all the shared spaces. Nonetheless, that is not all this policy will cover.
Sometimes the condo association policy may cover:
1. the physical structure of your condo, including its walls and floor.
2. your condos’ initial or original construction, including the fixtures.
3. only the condos bare walls, ceiling, and floor.
Things To Be Aware Of About Condo Association Coverage
1. In the US, there are several condo associations which makes for that many variations in the condo association insurance policy.
2. It is best to know the contents of your condo association insurance policy. It will tell you what all protections the association offers and what remains to be purchased by you. This way, you will be able to buy a more tailored personal condo insurance policy.
Why Buy Personal Condo Insurance When There Is Condo Association Insurance
A condo association insurance will majorly cover damage to all the common areas of the building. Some, though not all, may even cover your floor, walls, and ceiling. So this is also not guaranteed. What it will definitely not cover is the damage to your personal possessions. Therefore, in order to safeguard all your assets against any eventualities, it is advisable to buy personal condo insurance.
Other Optional Condo Insurance Covers
A condo owner can buy a few other optional coverages to get a well-rounded insurance policy. These include:
1. Protection Against A Stated Natural Calamity – Natural calamities are those acts of nature that wreak havoc on your personal property. It could be a flood, tornado, hurricane, snowstorm, etc. When you buy protection against a natural calamity, it is in addition to your condo insurance policy. Also, the calamity should be clearly specified.
2. Umbrella Insurance For Condos – To protect yourself from the financial effects of a devastating loss, you can purchase an umbrella cover for your condo. Such an addition will come in handy if the loss you suffer is more than the limit of your existing condo insurance policy.
It’s A Wrap
The best way to buy condo insurance is by first evaluating the contents of the condo association insurance policy. Once you know what all it covers, you can purchase an insurance policy that will cover the rest. Furthermore, strengthening it with additional optional coverages will give every condo owner to safeguard their assets even better.
If you find it challenging to understand the contents of your insurance policy or need help filing a claim, engage the services of Continental Public Adjusters. We know insurance like the back of our hand and can guide and represent you so that you get the maximum settlement in minimum time. To book an appointment, call us at (800) 989 – 4769.