Owning a condo can be a great opportunity to get into today’s competitive real estate market. Insuring this type of property, though, is a little different from a traditional homeowners policy, or even rental insurance. So, today we’ll elaborate on a few common questions/concerns we often get when talking about condo insurance.
1. What does it cover?
Since you only technically own the interior of this dwelling, your insurance policy really only needs to cover that. Everything from the interior walls, to your appliances, to your personal possessions therein receives protection under this policy; hence why it’s often referred to as “wall-to-wall” coverage. Typically, the limits under this plan for dwelling coverage are a little lower. You get to determine how much it would cost to replace all of your possessions and rebuild the walls in the event of a loss (of course, your insurance agent can help with that). But, that number is usually less than what you need with homeowners insurance to completely rebuild the structure(s).
Liability coverage is also something you need to carry, just in case a visitor injures himself/herself on your property—or if you inflict damage/harm to someone else outside of your condo. Much as this feature can be included in a homeowners insurance policy to limit the amount you’ll have to pay out-of-pocket for medical bills and/or court costs, similar protection is incorporated into your condo insurance.
2. What about the outside?
All of the exterior portions that are managed by your condominium association should be covered by a separate master policy—which you can request to see before you buy. Also consider checking out the bylaws to find out exactly what your responsibilities toward the exterior of the property entail. While you may not have to replace the roof, you could still be responsible for maintaining a portion of the lawn, or repairing the HVAC unit associated with your particular condo. These rules vary wildly, so talk to your neighbors and your association if you have any questions.
3. Does it come with anything extra?
While standard condo insurance covers the items we previously discussed, you may also have the option to add additional coverage to suit your situation. For example, if the master policy includes flood insurance, you may want to purchase a separate policy for yourself to ensure all of the items inside your new home are adequately covered. Or, if you have a lot of valuable items including jewelry, art, and electronics, extra endorsements could be a good option. These allow you to schedule certain items and increase the limit(s) for replacement if something were to happen to them.
From a liability standpoint, you may also want to talk to your insurance agent about adding an umbrella policy that will extend your coverage for larger claims/judgments. Often times, these also protect you from a wider variety of litigation, including libel or defamation cases.
If you’re looking to buy a condo, please reach out to our office! We work with a number of insurance companies that specialize in condo insurance, so we can get you quotes and help to determine the best coverage for you. Contact Freedom Insurance Agency today for more information.