Renting or owning your residence has one major aspect in common; the need for insurance. Although there are similarities between renter’s insurance and condo insurance, there are also differences.
Personal Property: Both renter’s insurance policies and condo insurance policies include protection for your personal property. A renter needs this coverage because the landlord’s policy does not cover anything but the structure of the building. A condo owner needs this protection because the condo association’s master policy will only cover common areas, but will not protect your belongings.
Real Property Coverage: When you own a condo, the master policy of the condo association covers a portion of the structure of the building. Some master policies cover the walls only and do not include fixtures like countertops or flooring. Some master policies cover the walls as well as fixtures, installations, and additions with interior surfaces of walls, ceilings, and floors. Real property covers items that are not typically considered real policy.
Personal Liability: If something happens to someone in your home, rental or condo, you will be covered up to your limit. For example, if your friend falls in your unit and then sues you, you will be covered up to your policy’s limit on legal expenses as well as what the person wins in court.
Loss of Use: If your unit is labeled unlivable due to one of the perils covered in your renter’s or condo insurance, you will be covered for additional living expenses.
Medical Protection: If someone gets injured in your unit and there are medical expenses, this portion will cover the medical expenses up to the policy’s limit.
Loss Assessment Coverage: Only found in condo insurance, loss assessment coverage takes care of expenses up to a specified amount if the condominium association levies a loss assessment against unit owners. This would happen if there were damages or losses against a collectively owned condo property. In other words, if the condo association’s insurance policy did not cover all the damages to a common area, condo owners would be required to pay a share of the loss.
When you purchase a condo, it is important to know what the condo association’s master policy covers. The master policy will let you know where common areas stop and your unit begins. This is important to know when determining how much coverage you will need. If you have any questions regarding the amount of coverage you need for your unit, talk to your insurance agent. They will be able to help you determine the perfect amount of coverage based on your needs.
If you are looking at purchasing a condo, then you will want to look into a condo insurance policy. You will need to check your condo association’s master policy and make sure your subsequent insurance policy gives you all the protection you need. If you are not ready to buy and are continuing to rent, then you will need to consider your renter’s insurance policy. You will want to make sure your personal belongings are covered as well as having the right about of liability coverage.