The Components of a Condominium Insurance Policy

There are several features and services that come with a condominium insurance policy. The components of the policy all focus on helping to insure you and your condo should an event occur that causes any damage. Below is a list of some components that come with having a policy for condominium insurance. Keep in mind that these are all standard basic coverages.

1) Contents coverage. This deals with insuring your personal belongings that are inside of your condominium. There are two types of contents coverage, All-risk coverage and Named-Perils coverage.

* All-risk coverage insures your belongings for the most common types of losses. Unless a type of loss is specifically excluded from a policy, your belongings are insured for everything that would happen.

* Named-Perils coverage consists of a list of the most common types of losses that are covered under the insurance, but are more specific than the All-risk coverage. The list of losses are usually described thoroughly for what your insurance policy covers.

The way that your possessions, should they be lost, are replaced are through two possible ways. They consist of:

* Actual Cash Value, or ACV. The way that your belongings are insured by ACV is that you receive the value of the item, with depreciation deducting some of that value. Despite the difference of the two values, the insurance policy would only pay the depreciated price of the lost item.

* Replacement Value. The insurer will pay you what it costs to replace the items as long as you buy a replacement item with a similar quality/brand, within a specified time. It’s also possible that the insurance policy would pay for a new TV even if it has a higher price than the previous TV that was lost.

2. Living expenses. Should the need arise where you’re forced out of your condominium after a loss, your insurance policy will pay for the necessary expenses like hotel costs to temporarily live away from home.

3. Personal liability protection. This covers any costs that arise if someone injures themselves on your property where you might be found responsible for damages. This also covers any damages that might have been caused by a member of your family. This insurance policy will also cover you anywhere in the world should you accidentally injure someone.

4. Voluntary payments for medical expenses. This covers the expenses of anyone who might injure themselves as a consequence of your personal activities or the way your condominium is maintained.

5. Voluntary payments for damage to property. This type of coverage can occur if the property of others is damaged by your personal activities or the way your condominium unit is used.

6. Improvements and betterments protection. A feature that compensates you for any extras added to your unit, on top of the initial coverage.

8. Loss assessment. This component is necessary to insure you for any damages that might happen on common property. This includes a loss that affects the common property, or if someone injures themselves on shared common property.