Condo Insurance Explained
Buying a condo home can be a terrific way to get your toe wet in owning real estate. Condominiums generally cost far less than a typical single-family home and will also require less maintenance on the part of the homeowner. This all being said, buying a condo home will likely be your biggest investment, so it makes sense to protect it with good condo insurance coverage.
What it is
Condo insurance is a kind of property insurance that is designed specifically for owners of condominium homes. The vast majority of insurance that a building owner or condo HOA has will not cover any of your personal belongings nor will it fix items within the walls of the unit, like plumbing and electric, HV/AC, appliances and floors. Condo policies will typically cover these things and provide you with personal liability protection as well.
Good condo insurance coverage is designed for those who own and live in a condo unit. If you rent out your condo to or from someone else, you will need different specialized coverage.
How it works
Condo coverage functions much the same as other kinds of property insurance, like homeowners or renters’ insurance. If your condo residence is damaged or destroyed by a covered peril, for instance a fire or a severe weather event, you will need to get in touch with your insurer to make a claim. Once an adjuster has paid you a visit and ensured your claim is legitimate and determined the extent of damage, the insurance provider will then pay out whatever it owes, less your agreed upon deductible and not to exceed the policy limit. If you are the recipient of a personal liability claim, your insurer will also assist you in negotiating and then paying a settlement or, if necessary, to defend you in court.
Kinds of coverage
There are really just two types of condo coverage. The kind you choose will likely depend on the building owner or HOA policy details. If the existing building policy is an “all-in” policy, then the condo owner need only purchase a condo policy that covers his or her own personal belongings. If, on the other hand, it is a “bare-walls” type of coverage, then one will need a policy that also protects the walls, floors, appliances and fixtures as well as your other belongings.
The biggest benefit of condo insurance is the peace of mind in knowing that your personal belongings and anything else in your dwelling is protected. Another benefit is personal liability coverage that is also included.