What Does Condo Insurance Cover?

Condo owners are usually covered by two types of insurance, the condo association insurance (master policy or HOA insurance) and condo insurance for the individual unit (HO-6 policy).

The building’s master policy covers the exterior of the building, including common areas to a specified limit. So, if one of your guests was injured in a common area, the shared policy may also cover liability expenses linked to the injury.

In the meantime, your condo insurance will protect everything inside your condo, including your personal possessions as well as dwelling coverage for the unit. Your condo insurance also includes “loss assessment” coverage, which covers your portion of damages to the common areas.

Your condo coverage needs will be impacted by what’s now insured in your homeowners association (HOA). In other words, make sure your condo insurance picks up where your master policy left off.

HOA Insurance  

The extent of coverage of your HOA insurance is based on the kind of policy you have.  For example, a bare-in policy covers the structure of the condominium – things behind the walls such as framing, installations, wiring, and plumbing are covered.

An all-in policy, on the other hand, includes coverage for condo fixtures, such as your floors, countertops, and built-in appliances such as a refrigerator or dishwasher. Personal belongings that you can take with you aren’t covered. Also, you aren’t usually covered for renovations you made after you moved into your place, so you probably need supplemental dwelling coverage.

Essentially, your HOA insurance will cover the following:

• Common areas such as the lobbies, building’s exercise room, swimming pools, and outdoor pavilions are covered for personal liability and physical damages.
• The exterior structure of the condominium is protected against property damage.
• The land surrounding the condo building is protected when damaged or when a guest is injured on the premises, for example.

Condo Insurance

A condo policy covers similar perils as your standard homeowners insurance policy, which include bad weather, fire, vandalism, and theft. However, condo insurance doesn’t cover earthquakes and flooding. You will have to purchase separate earthquake and flood insurance.

When it comes to condo insurance, you can expect the following type of coverage:

• Dwelling coverage: Dwelling coverage is based on your condo association policy and whether walls-in or all-in coverage is included.
• Other structures you own: There may be other structures connected to your condo such as storage or garage, for instance, which only you use and it’s not property of the condo association.
• Personal belongings: This is a fundamental part of your condo insurance policy, which covers your furniture, appliances, and electronics, if damaged by a covered peril.
• Personal liability costs: If someone is accidentally injured in your condo, for instance, and he or she takes legal action, the legal costs of a lawsuit can be very expensive, so make sure you have enough personal liability. If you need extra coverage, more than what you already have, a personal umbrella policy can help you increase your liability limits.  
• Medical payments: You will be reimbursed for medical expenses if the injured occurred in your condo no matter whether you are responsible or not.
• Additional living expenses: This covers additional living expenses when your condo is damaged by a covered peril and made uninhabitable. Also, if you need to relocate, the temporary living expenses or hotel are covered by loss-of-use coverage until you find a permanent residence.

Other coverage needs can be met by other types of coverage such as loss assessment coverage, water backup coverage, and a scheduled property endorsement. Ask a licensed insurance agent to look through your master policy and find the right coverage for you.