Understanding Condo Insurance
How do you know you’re getting the best protection without paying too much for your condo insurance?
Without enough protection, you could expose yourself to great personal risk. Condo insurance is complicated. It’s different than homeowners insurance and renters insurance.
What Makes Condo Insurance Different?
When you buy a condo, you usually automatically become part of a condo association. In fact, you’ll pay a monthly assessment for that. That fee funds care of the common grounds of the association (You won’t have to mow the lawn, landscape or shovel snow!).
In addition to the common grounds (walkways, lobby, hallways, etc.) the cost of caring for the outside of the condo structure itself is part of the assessment you pay. A portion of that expense is insurance. But please note, your association provides insurance for the exterior part of the structure only! All of the interior including drywall, flooring and cabinets will most likely be your responsibility in case of damage.
Furniture, electronics and all your other personal possessions will also be your responsibility to protect.
In addition, you may be held liable if anyone gets injured while in your home or if something you do results in damage to the common areas.
Five Questions to Ask About Condo Insurance
Armed with this knowledge, discuss these questions with your Huff Insurance Insurance agent:
- What does my association insurance cover and not cover?
- What remains for me to insure?
- How much would it cost to repair the inside of my condo?
- How much would it cost to replace my belonging?
- What protection do I need against liability claims?
Thorough discussion and answers to these questions with the experts at Huff Insurance Insurance will provide you with the sublime peace of mind that is the heart of all good insurance coverage.
You and your Huff Insurance Insurance agent will consider these five main coverages:
1.) Condo Liability Insurance Coverage
It’s a cliche to say accidents happen, but it’s genius to have prepared for them ahead of time with the proper amount of liability protection.
This coverage will protect you if you or any other named insured are found legally responsible for any injury or property damage on or away from your property. It includes:
- Compensation for the injured party
- The cost of your defense
- Most court awards
The coverage is good up to the policy limits. So, make sure, especially if you possess significant assets, you’re completely protected.
2.) Property Insurance Protection
There are four definititions tha apply to property for a condo. They are:
- Common Elements: Property owned by and/or benefiting ALL members of the association
- Limited Common Elements: Property elements beneficial to more than one, but less than all unit owners
- Unit Property: Property elements that benefit none but the unit owner
- Unit Improvements and betterments: Alterations or changes to the real property defined as unit property that increases the value of that property within an individual unit
You will be responsible for the interior of your unit. This may include cabinets, appliances, and light fixtures—or everything inside your home.
The level of your responsibility will be determined by the condo association and what is in their by laws what is covered by their master condo insurance policy. So the amount of the “building coverage” or “coverage A” will be affected by the insurance resposibility clause in the condo master insurance declarations.
Insurance resposibility can be defined in one of three ways in the condo master declarations:
1.“All in” or All Inclusive”: When the association specifies this type of coverage, the association is responsible for all 4 types of real property. The unit owner only has to insure their personal property. Standard HO6 usually has $1,000 automatic building coverage which would be sufficient for All In.
2.“Bare Walls”: Opposite of All in. The association is only responsible for insuring the common elements and limited common elements. Unit owner is responsible for unit property and any unit betterments and improvements. The standard building coverage would not be enough for the unit owner.
3.“Original Specifications”: This is the middle ground between the two above. The association is responsible for the common elements, limited common elements and “original” unit property (what the builder put in at time of construction). The unit owner is responsible for unit betterments and improvements (upgrades to counters, cabinets, fixtures, etc.) or any additions to the unit (enclosed porch). Again, the automatic building coverage will not likely be enough for this type.
In some cases, your total property limit may be enough to adequately insure what you own. However, if you have possessions in other property categories, your coverage may be limited. For example check the coverage limits on:
- Business samples or other property used for business
- Trading cards
Many condo minimum property insurance limits are $25,000. Carefully discuss your property situation with your Huff Insurance Insurance pro. Make sure you have the protection you need.
3.) Guest Medical Insurance Protection
It doesn’t matter whether or not you’re held responsible for an accident that occurs in your home. This coverage will provide payments for reasonable medical expenses for the injured party up to the policy limit no matter who caused the accident.
4.) Additional Living Expenses
If a covered loss (fire, lightning, smoke, etc.) causes you to have to vacate your condo because it’s uninhabitable, this will cover expenses associated with living elsewhere. For example, it will pay your hotel bill, food and other reasonable charges.
5.) Loss Assessment Insurance Coverage
You are paying a monthly assessment to live in your condominium community. If your association decides to assess a special levy because of certain losses to your condo complex, this coverage will pay your portion up to the coverage limit (usually $1000).
Condo Insurance and Huff Insurance Insurance
In his book, Outliers, Malcolm Gladwell suggests that it takes 10,000 hours of practice to become an expert. Huff Insurance has been providing condo insurance for the citizens of Maryland for over 60 years. We have spent the time needed to fully understand Condo Insurance so that you can rest assured, your needs will be taken care of!
Not only are we seasoned pros but we will listen to make sure we fully understand your needs—even during those times when you’re uncertain. This bit of light is what distinguishes Huff Insurance.
Are you ready to protect yourself with the pros?
Contact us today 410-647-1111 to discuss your condo insurance needs.