Condominium owner’s insurance plans cover the majority of the policyholder’s personal possessions up to the specified limit if damaged or destroyed by an insured disaster. Most condo owner’s insurance plans include additional features like personal liability coverage for legal costs and loss of use coverage for living expenses during qualifying disasters.
Sometimes, condominium owner insurance plans are part of the building’s Home Owners Association (HOA) master insurance policy that cover’s the entire building and manages individual condo owner’s policies.
Like all insurance policies, some master insurance plans are more comprehensive than others. Becoming familiar with all of the features included in your condominium’s HOA master plan can save you the money from buying double insurance coverage. Along the same lines, because the specific coverage details of every condo insurance plan can vary significantly, it is important to look through the fine print of whatever individual condo owner insurance plan you are considering before you make the final purchase.
Condo owner insurance policies apply to a very specific area within the condominium building. Understanding these coverage limitations is essential to understanding what is actually covered by your plan. Similarly, the overall coverage amount along with the out-of-pockets costs associated with the plan you choose could limit coverage for certain high priced items or categories of belongings.
Some add-ons only increase your monthly premium by only a few dollars a month but provide you with tens if not hundreds of thousands of dollars in coverage for when the worst case scenario happens.
If a certain type of personal belonging or disaster is not included in a condo owner’s insurance policy that you are looking into, inquiring about available changes to existing insurance policy packages could get you the combination of features you were looking for. Read on to discover more important information about what is coverage by typical condominium owner insurance plans across the country.
What Physical Space Does a Condo Unit Owner’s Insurance Policy Cover?
While renter’s insurance covers a policyholder’s personal possessions and homeowner’s insurance generally covers a policyholder’s personal possessions in addition to the physical property itself, pinning down exactly what personal property is covered by a condo owner’s insurance policies is slightly more complicated.
This is because, beyond offering protection for most personal possessions like renter’s insurance policies, condo owner’s insurance policies also usually cover the interior area of the physical structure of the condo unit. This is an important differentiation because many walls, floors and ceilings are shared between one or more units in condominium buildings.
To clarify where one condo owner’s insurance policy ends and another condo owner’s policy begins, most HOAs draw lines at the studs. Everything from the studs of the walls, floors or ceilings inward is covered by that condo unit’s owner.
This includes coverage for personal possessions in addition to flooring, cabinets, and other interior structural elements. Everything outward from these studs is considered the purview of your neighbor’s insurance policy. The entire building structure itself and any spaces not pertaining to any individual condo unit owner are covered by the HOA’s master insurance policy. The master policy is like a group homeowner’s policy that coordinates building coverage with those of individual unit owners.
What Coverage Options Are Available with Most Condominium Owner’s Insurance Plans?
Now that you understand what area that most condo owner’s insurance policies apply to, it is time to think about what sort of coverage you need to completely cover your personal property and to meet any building HOA insurance minimum obligations. The most basic element of all condo owner’s insurance plans is protection for your personal possessions. In this sense, condo owner’s insurance is extremely similar to renter’s insurance plans and generally covers the same sort of belongings if damaged or lost due to the same sorts of disasters. Personal property, like computers, photo equipment, jewelry, valuable clothing and accessories, workout equipment and much more can all be covered up to agreed upon limits with condo owner’s insurance plans. Situations that have caused the damage or destruction of your property and that may merit an insurance payout include theft, fire, wind, vandalism and much more.
Most insurance providers offer policyholders one of two options for personal property protection: actual cash value plans or replacement value plans. Actual cash plans will only reimburse you for the current-day value of your lost possessions, depreciated since the time it was purchased. Replacement value plans generally have higher premiums but provide claim payouts that are enough to replace a damaged or lost item with a new version at market value. Some condo owner’s insurance plans place specific limitations on how much of your total coverage amount can be used for claims from specific categories of personal possessions. Most policies also cap how much of your coverage can be used for repair or replacement of a single item. Make sure to add any specifically high cost items as separate riders or endorsements at the time of policy purchase to guarantee their coverage.
In addition to personal property protection, most condo owner’s insurance plans also provide hundreds of thousands of dollars in personal liability protection. This coverage will pay your legal and settlement fees if you are ever sued for negligence that resulted in the accidental harm of a person or to someone else’s personal property. Some policies also provide no-fault medical payment coverage or guest medical coverage of around $10,000 to help pay for associated medical costs for anyone accidently injured on your property.
Additional Building Property Protection is added on to some condo unit owner’s insurance plans, providing dedicated coverage to help pay for repairs to the interior walls or other built-in features as needed. If you are ever forced to leave your condo because it has been made unlivable due to a covered disaster, loss of use coverage which is included with most condo owner’s insurance plans will help you pay for any additional living costs you face while temporarily blocked from returning home.
What Are Some Common Add-On Coverage Options for Condo Owner’s Insurance Policies?
The different types of coverage mentioned previously are more often than not included in an average condo owner’s insurance plan. Often, however, it can be useful to look at adding on even more coverage options to completely safeguard your home and your personal possessions from whatever problems could arise. Consider signing up for one or more of these additional coverage options to make your condo unit owner’s insurance plan as bulletproof as possible:
- Loss Assessment Coverage: Covers any out-of-pocket costs that may be asked of you by your HOA to help pay for the damage or loss of communal property that is otherwise covered by the HOA master policy.
- Flood Insurance: While most condo owner’s insurance plans will cover water damage to your personal property if a pipe bursts or your fire-protection sprinklers go off, they will not cover damage or loss due to generic flooding. Adding on flood insurance coverage may be the only way to protect your possessions if this disaster happened. In fact, some HOAs require condo owner’s to purchase additional flood insurance for their condo owner insurance policies.
- Umbrella Insurance: Umbrella insurance programs will help you cover costs associated with personal liability charges if said costs were to extend beyond your condo owner’s insurance personal liability coverage limit. It can help pay for large liability claims and sometimes even provide protection against libel or slander.
- Item Endorsements: Item endorsements are useful for declaring any specifically valuable items you own that you would like to guarantee coverage for. Making an item endorsement with an appraisal when you sign up for your condo owner’s insurance policy can save you a lot of time and potentially money if you ever have to make a claim for that item.
By Melanie Henson –