Insuring Your Condominium Investment

The condominium association bylaws establish what the unit owner needs to ensure. The vast majority of by-laws state that the unit owner is responsible for insuring everything inside the drywall of the outer walls of the unit. This means that normally under the building coverage of a condo policy (referred to as an HO-6), you are responsible for items such as the floor covering, kitchen cabinets, sinks, dishwasher, bathroom fixtures, including the tub, shower, and toilets, furnace, water softener, and even interior walls, including the wiring in those walls. The “master policy” purchased by the condo association covers the exterior of the building up to and including the drywall of the outer walls of your living unit.

Architects discussing building models and plans.

Property Coverage

Coverage is normally provided on an all-risk, subject to exclusions, basis. Major exclusions include damage caused by flood, earth movement, water leaking into basements, settling and cracking of foundations and walls, war, and nuclear reaction. Another exclusion is for damage caused by the backup of sewers and drains and the overflow of sumps. Special coverage can be added to provide this protection.

Personal Property

The starting point for this coverage is what is referred to as named-peril coverage. Major named perils include fire, lightning, wind, smoke, vandalism, and theft. Many other minor coverages are included. This coverage can be expanded to all risks, subject to exclusions, for an additional premium. There are significant limitations on money, jewelry, guns, and business equipment. No coverage is provided for autos, motorcycles, or motorized recreational vehicles under a homeowners policy.

Loss of Use

Provides coverage for additional living expenses incurred when your condo unit is not habitable as a result of a covered loss.

Liability Coverage

Personal Liability

Provides protection should you accidentally injure someone. Also provides protection should you accidentally damage the property of others.

There are many issues that need to be considered when properly tailoring a homeowner's policy to fit your specific needs. We are here to help you.

*The above descriptions are generalizations and should not be relied upon when determining coverage. You must refer to the actual policy wording when determining whether or what type of coverage applies.

DISCLAIMER: If you need a policy updated or changed, please contact your respective agent.