Homeowners are generally aware that they are required to carry homeowner’s insurance, but may not be as familiar with the ins and outs of condo insurance. It’s important to be aware of what is and isn’t covered by your condo insurance, as well as the role and responsibilities of your condo association.
Condo Association Responsibility
The first thing you should know is that the condo insurance is usually held by both the condo association and each condo unit owner. Therefore, to make sure you have the right protection for your condo, you must first understand what is covered by your condo association.
If your building is part of a condo association, the structure itself and common areas may be covered by the association's master policy. According to the Insurance Information Institute (iii.org), these areas may sometimes include the boiler room and the roof, as well as hallways and other shared spaces, including the common rooms and swimming pool.
The terms of the master policy can affect your own insurance coverage of the unit. “It's a good idea to brush up on what protection your condo association has in place so that you know what types of coverage your personal policy should provide,” according to iii.org. Since there are thousands of condo associations in the U.S., you’ll want to read your association's bylaws to learn what parts of your home are covered by the master policy and which parts you will need to insure on your own.
Condo Owner Insurance & Responsibility
When you buy a condo, you are typically solely responsible for the interior of your place. On your condo policy, you'll likely need just enough dwelling protection to rebuild the interior of your unit (everything from the wall studs in).
Condo insurance generally helps protect your unit against a number of perils, such as fire, theft or vandalism, according to Esurance.com. A typical condo policy offers protection in three areas:
•Building Property Protection. This type of coverage typically helps protect the walls of your condo unit and its interior, which could include items such as built-in bookcases and fixtures.
•Personal Property Coverage. From your electronics and appliances to clothes and books, there are plenty of personal items in your condo that you may want insured in the event of loss. Because personal property is typically not covered by an association's master policy, condo owners usually must purchase individual policies that include this type of coverage.
•Personal Liability Coverage. If someone is accidentally injured while visiting your condo, this coverage can help protect you in the event that you're named in a lawsuit, according to iii.org. It may also help cover your guest's medical bills. However, you typically don't need liability protection for claims involving building common areas — if a visitor slips in the pool area or falls in the lobby entrance, your HOA insurance will typically kick in.
Other Protections
Many insurance providers offer add-on protections for occurrences not covered in a standard policy. Here are a few of the most common such coverages:
•Flood. Flood damage is typically not covered by a standard condo policy, according to bankrate.com. Most flood insurance policies are issued through the National Flood Insurance Program. In some cases, you may even be required by your mortgage lender to purchase flood insurance, according to the program.
•Umbrella Coverage. For additional liability protection, you may want to consider investing in a separate personal umbrella policy. This kind of policy goes into effect when you reach the limit of your condo's liability coverage and can help protect you against large liability claims or judgments. It may also help provide protection if you are sued for libel or slander, according to the III. “Your insurance provider may require a certain level of liability coverage on your standard condo policy — generally $300,000 — before you are able to purchase an umbrella policy,” according to iii.org.
•Endorsements. Additional personal property coverage, also referred to as "Scheduled Personal Property," is typically available for an additional cost. For example, while a standard condo policy typically caps coverage for jewelry at $1,000 or $2,000, scheduled personal property coverage, often known as a "floater" or "endorsement," may provide greater protection for your valuables, according to the III.
Condo Insurance Costs
Condo insurance costs vary. The cost of condo insurance, on average, ranges from $100 to $400 per year, depending on the value of your personal property and the type and amount of coverage you carry. For example, someone with a number of valuables, such as jewelry, fine art, antiques or collectibles, will need to add additional coverage for those items.
When it comes to insurance for your condo unit, you should make sure you have ample protection, and you know your rights and responsibilities. Discuss questions and concerns with your agent to select the condo insurance policy that's right for you.
Sources: allstate.com; esurance.com; libertymutual.com; bankrate.com; trustedchoice.com; iii.org
Condo Association Responsibility
The first thing you should know is that the condo insurance is usually held by both the condo association and each condo unit owner. Therefore, to make sure you have the right protection for your condo, you must first understand what is covered by your condo association.
If your building is part of a condo association, the structure itself and common areas may be covered by the association's master policy. According to the Insurance Information Institute (iii.org), these areas may sometimes include the boiler room and the roof, as well as hallways and other shared spaces, including the common rooms and swimming pool.
The terms of the master policy can affect your own insurance coverage of the unit. “It's a good idea to brush up on what protection your condo association has in place so that you know what types of coverage your personal policy should provide,” according to iii.org. Since there are thousands of condo associations in the U.S., you’ll want to read your association's bylaws to learn what parts of your home are covered by the master policy and which parts you will need to insure on your own.
Condo Owner Insurance & Responsibility
When you buy a condo, you are typically solely responsible for the interior of your place. On your condo policy, you'll likely need just enough dwelling protection to rebuild the interior of your unit (everything from the wall studs in).
Condo insurance generally helps protect your unit against a number of perils, such as fire, theft or vandalism, according to Esurance.com. A typical condo policy offers protection in three areas:
•Building Property Protection. This type of coverage typically helps protect the walls of your condo unit and its interior, which could include items such as built-in bookcases and fixtures.
•Personal Property Coverage. From your electronics and appliances to clothes and books, there are plenty of personal items in your condo that you may want insured in the event of loss. Because personal property is typically not covered by an association's master policy, condo owners usually must purchase individual policies that include this type of coverage.
•Personal Liability Coverage. If someone is accidentally injured while visiting your condo, this coverage can help protect you in the event that you're named in a lawsuit, according to iii.org. It may also help cover your guest's medical bills. However, you typically don't need liability protection for claims involving building common areas — if a visitor slips in the pool area or falls in the lobby entrance, your HOA insurance will typically kick in.
Other Protections
Many insurance providers offer add-on protections for occurrences not covered in a standard policy. Here are a few of the most common such coverages:
•Flood. Flood damage is typically not covered by a standard condo policy, according to bankrate.com. Most flood insurance policies are issued through the National Flood Insurance Program. In some cases, you may even be required by your mortgage lender to purchase flood insurance, according to the program.
•Umbrella Coverage. For additional liability protection, you may want to consider investing in a separate personal umbrella policy. This kind of policy goes into effect when you reach the limit of your condo's liability coverage and can help protect you against large liability claims or judgments. It may also help provide protection if you are sued for libel or slander, according to the III. “Your insurance provider may require a certain level of liability coverage on your standard condo policy — generally $300,000 — before you are able to purchase an umbrella policy,” according to iii.org.
•Endorsements. Additional personal property coverage, also referred to as "Scheduled Personal Property," is typically available for an additional cost. For example, while a standard condo policy typically caps coverage for jewelry at $1,000 or $2,000, scheduled personal property coverage, often known as a "floater" or "endorsement," may provide greater protection for your valuables, according to the III.
Condo Insurance Costs
Condo insurance costs vary. The cost of condo insurance, on average, ranges from $100 to $400 per year, depending on the value of your personal property and the type and amount of coverage you carry. For example, someone with a number of valuables, such as jewelry, fine art, antiques or collectibles, will need to add additional coverage for those items.
When it comes to insurance for your condo unit, you should make sure you have ample protection, and you know your rights and responsibilities. Discuss questions and concerns with your agent to select the condo insurance policy that's right for you.
Sources: allstate.com; esurance.com; libertymutual.com; bankrate.com; trustedchoice.com; iii.org
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