How Is Condo Owners Insurance Different Than Standard Homeowners?

When you’re comparing condo owners insurance and a standard homeowners insurance policy, are they different? Yes. When you’re insuring a condo you are only working within the space that you own and are then responsible for.

Condo insurance covers damaged or stolen belongings, as well as liability costs if guests are injured in your home. As a condo dweller, you don’t own the structure you live in or the land its on, meaning you are usually only insuring walls in leaving it up to the condo or homeowners association to carry a master policy to insure studs out.

What is Condo Insurance?

Condo insurance covers what your Condo Association Master Policy won’t, like repairing the inside of your unit after disasters, replacing damaged or stolen belongings and paying liability costs if guests are injured there. Many times, part of your condo fees will go toward a master policy to insure the exterior of the structure in the event of damage. Examples of what would fall under the COA’s jurisdiction are damage to the roof, exterior walls, hallways, elevators, and other common areas such as tennis courts, swimming pools or lobbies.

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What’s Covered in my Condo Owners Policy?

Usually your own policy on your condo will cover three things: your personal property, loss of use to cover living expenses in the event that damages force you to vacate for a time and in the event of damages if someone sues you due to negligence.

Below are some common problems that would and wouldn’t be covered with a typical condo owners insurance policy:

Usually covered:

  • Fire and smoke
  • Explosions
  • Wind and hail
  • Theft
  • Vandalism
  • Lightning
  • Burst pipe

Usually not covered:

  • Earthquakes
  • Floods
  • Intentional injuries to others
  • Nuclear hazards
  • Damage from birds, rodents and insects
  • Wear and tear
  • Damage from underground water

Is Condo Owners Insurance Required?

Current laws do not require you to carry an insurance policy as a condo owner. Similar to homeowners insurance, a mortgage lender will commonly require you to purchase a policy to protect their financial investment through the length of your loan.

 

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Phone: 877-994-6787
Email: insure@siaonline.com
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PS Here’s a few words from one client that trusts Stromsoe Insurance Agency:

“Stromsoe Insurance is a reliable agency, it has provided fast and excellent service and made the process of finding the best homeowners insurance for our home. Thank you Maritza for taking care of our insurance needs!”
Betty Harrington – Murrieta, CA – Client Since 2014

PPS Every policy is backed by our iron clad, 100% complete satisfaction guarantee. Ask for your copy today!

Five Things You Should Know About Condo Association Insurance

A condominium unit owner usually has their own insurance policy that covers for loss of personal belongings, parts of the building that the condominium agreement makes individual owners responsible for insuring, the additional cost of living elsewhere after a fire damages a unit, and legal liability for injuries or damages suffered by others. In turn, the condominium association has its own policy, which might cause some unit owners to wonder why they have to buy separate insurance. Doesn’t the association’s insurance cover the same things? Depending on the property at issue, the answer is maybe yes and maybe no. Insurance companies designed the two types of policies to complement each other in some cases and to overlap in others. Here are five things unit owners should know about their associations’ insurance.

The association’s policy covers the building. Depending on the wording in the contract between the association and the unit owner, the word “building” may mean several different things. If the contract requires the association to insure them, “building” can include fixtures, improvements and alterations that are part of the building and that are within a unit. For example, if a unit owner installs new track lighting or an attached island in the kitchen, the association’s insurance would cover the cost of repairing or replacing them after a loss. Also if the contract requires, the association’s insurance will cover various appliances such as refrigerators, stoves and dishwashers.

The association’s policy covers personal property “owned indivisibly by all unit owners.” Furniture in the building’s lobby, hand carts and other moving devices, and exercise equipment in an exercise room available to all residents are examples of the types of property that the association’s policy insures.

The association’s policy does not cover the unit owner’s personal property. A unit owner must buy their own insurance to cover furniture, electronics, clothing and other belongings. Assume, for example, that the condominium contract requires the association to insure appliances. If fire damages a unit owner’s space, the association’s insurance will cover the refrigerator but not the sofa. The unit owner’s policy will cover the sofa. The association’s policy also does not cover an individual unit owner’s legal liability for injuries or damages suffered by others. The unit owner needs their own insurance to provide for legal defense and to pay any judgments.

It is possible that both policies may apply to the same item of property. In the above example, both the association’s and unit owner’s policies may cover the refrigerator. In that situation, the association’s policy will apply first; if it does not completely pay for the repair or replacement, the unit owner’s policy will cover the balance. For example, if the cost of replacing the refrigerator is $5,000, and for some reason the association’s policy covers only $4,000, the unit owner’s policy will pay the other $1,000 (the example doesn’t include deductibles that may apply).

The association’s insurance company will not try to get its money back from a unit owner. Suppose a unit owner left a candle burning overnight and the unwatched candle caused a fire that damaged part of the building. Many types of insurance policies would allow the insurance company to pay its customer for the damage, then try to recover its payment from the person who caused the damage. However, a condominium association policy specifically states that the company waives its right to recover from a unit owner. It still has the right to seek recovery from a person who is not a unit owner and is responsible for the damage.

Although comprehensive, the association’s policy is no substitute for a unit owner’s own insurance. Work with our professional insurance agents to ensure that you have the proper coverage.

If you have any question regarding this article or if you would like to discuss your insurance program, CALL 877-994-6787, that’s 877-99-INSURE and speak with any one of our knowledgeable Protection Coaches Today!

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