What Insurance Do I Need for My Condominium?

When you have made an investment in a condominium, you may want to insure that investment against loss and liability.

There are two types of coverage involved when you purchase a condo:

1. Condominium Association or Master Policies

This policy, typically taken out by your condo association of which you pay monthly dues, will cover you for any damages to shared areas including the lobby, walkway, and stairways. It is important that you understand what is covered in each part of your condo’s master policy. Every master policy is different, and these policies will state what is covered and what is not covered in case there is a loss. You should always show your master policy to your insurance agent so he or she can guide you in any additional insurance protection that you may need.

2. A Condo Unit Owner’s Personal Policy

This is an insurance policy that will cover your personal belongings as well as any of the building’s structure or improvements involving your living quarters. Condo owners need insurance coverage so they are covered against liability, damage, or loss of their own property. These types of policies can also help offset assessments to condo owners for damages to any common areas of the property that may occur.

There are some additional coverage areas that you should discuss with a qualified insurance agent:

1. Assessments applied to damaged units

If there is damage in a common area of the building, you could be assessed a fee for a share of the repair, even if you had nothing to do with the damage. You can select an option on many condo owners policies that will cover you for these types of assessments.

2. Water damage to building & property

Some property owners have to pay for damages incurred from back up of sewers and plumbing…if your policy does not specifically state that you have this type of coverage you will be responsible if this damage should it occur. Check the wording in your master policy to see what you may become liable for (responsible for) should water or sewer backup occur within or outside your unit.

3. Consider an umbrella policy for additional protection

An umbrella policy is fairly inexpensive and will provide property owners a way of obtaining a greater amount of liability coverage than what is included in a common condo policy.

4. Find out if endorsements to your policy are needed

If you have valuable collectibles, such as jewelry or other expensive items, you should be aware that standard insurance policies will typically offer fairly low limits for theft or vandalism to these items. Many policies only cover these types of items up to $1,000-$2,000. If your losses could be significantly higher than these amounts, you may need to consider a floater or an endorsement to your policy.

An insurance professional who offers coverage for condominiums will be your best resource for your condo insurance questions. They can read through your master policy and review it with you so you can understand what is included and what is NOT included in your policy so you can be sure to get the coverage that is right for you.