Condominium Insurance

Condominium Insurance

As a condominium owner, the first thing you need to know about insurance is that you will need two policies to be fully protected. The master policy protects the common area, general structure, and provides liability protection for the association. The master, or association policy is typically paid through association dues. Your lending institution will most likely verify that the master policy coverage is in force before securing your loan, however only rarely will they require proof of a personal condo policy.

The biggest insurance mistake most condo owners make is not realizing that they need a personal policy in addition to the master policy. While the master policy protects the overall structure it does not cover losses to personal belongings, improvements made to your unit, such as a remodel, or for damages from an accidental loss, which you become legally obligated to pay (liability protection). A common misconception is that the master association coverage extends to protect improvements throughout the condo. In many cases the association insurance stops at the exterior walls – making you responsible for all finishes, including appliances, fixtures, and interior walls. A professional insurance agency can help you review your association coverage, determine what the association policy covers, and place coverage for your personal protection needs.

A few key elements your personal condo coverage should provide:

• Personal Property Protection – Insurance for items such as furniture, clothing, and other personal belongings.
• Building Property Protection – Protects improvements that have been made to the unit such as upgraded kitchen cabinets, appliances, and fixtures.
• Liability Protection – Protects for damages you are legally obligated to pay, such as bodily injury and property damage lawsuits.
• Additional Living Expenses – Pays for reasonable increases in living expenses if you condo becomes uninhabitable. This is important coverage as eating out and hotel costs can quickly add up to thousands of dollars.
  
  More condo insurance information
  
  More condo insurance information from the Insurance Information Institute