Condo Insurance: Reinforcing Your HOA Coverage and Your Own Protection

February 12, 2017

You can leave it to your homeowners association to get coverage for your condo’s external premises and amenities. But as to the personal property inside your unit, it’s safer to have your own condo insurance.

Condo insurance works like a typical homeowners insurance in the condominium setting. It gives protection against forces of nature and some human deeds, covering you for losses from those events.

Get to know this homeowner’s policy here and get tips in buying condo insurance.

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Your Condo’s HOA Insurance

A portion of your homeowners’ dues goes to the insurance of your condo building.

Homeowners association insurance or HOA insurance has a wide coverage encompassing:

(i) coverage on the structure of the building and its common elements like clubhouse and pool, (ii) liability when an accident or injury occurs in the building’s common areas, (iii) director and officers’ liability when they are sued, and (iv) protection against theft by employees, contractors or the condo’s management.

In terms of property coverage, the condo’s master policy can be all-in or all-inclusive where all real property found in the individual condo units and any improvements in the condo unit owner will be covered per the International Risk Management Institute (IRMI).

If the master policy is structured as bare walls, only the bare structure of the condo unit is covered as well as the fixtures and furnishings found in common areas, and the personal property collectively owned by the association.

This leaves your personal possessions and everything you use exclusively at risk and you facing economic losses as a result.

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Your Own Condo Insurance

Condo insurance fills the gap created by your master policy, if ever. Also called as HO-6 policy, this insurance package functions like a standard homeowners policy only on a condo unit.

What does your condo policy cover?

  • Economic losses when your personal possessions and/or your interiors get damaged by fire, storms, hurricanes or windstorms, or lost due to theft. Earthquakes require a separate insurance and must be taken by the HOA.
  • Loss of use when your home is temporarily uninhabitable and you are staying elsewhere while repairs are ongoing.
  • Artwork, jewelry and other expensive items inside the condo may require additional coverage.
  • Potential lawsuits and attendant medical expenses when someone has an accident in your home and claims compensation.

For a complete coverage, umbrella or extra liability goes beyond the limits set by condo insurance, auto, and other insurance policies.

Buying Condo Insurance

The costs of condo insurance depend on numerous factors. There’s the condo building itself: the condo master policy, its location and value.

Because the master policy covers the external structure of the building, you’ll be paying less compared than homeowners insurance. However, it’s a separate payment on top of your association dues.

From your end, you’ll see these variables factoring into your insurance premiums: amount and type of coverage, deductible, and discounts, if any.

Do research about prevailing condo insurance rates and check them with multiple insurers.

Comparison shopping can save you hundreds of dollars and help you avoid costly mistakes.

Get insurance quotes from trusted insurers on your condo insurance here.

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