Condo Insurance 101: What, Who, How, and Why?
Condo living is different than any other kind of living. When you own a condo, you are typically responsible for the interior of your home. The land outside, building structure, and building common areas are usually jointly owned by you and your neighboring condo dwellers and thus insured by your HOA.
What is condo insurance?
This kind of insurance is for those who own a condominium. It provides dwelling insurance protection that, in the event of disaster, allows you to rebuild your condo’s interior – from the wall studs in. It does not cover the exterior of the building, exterior walls, hallways, elevators or other areas you may access that are not specifically within the walls of your condo.
It also provides liability coverage in the event someone is injured while inside your condo, you injure someone accidentally while away from home, or if you damage someone’s property.
Lastly, it provides personal property coverage, paying you to replace your personal property (furniture, clothing, jewelry, etc.) in the event of a covered event.
Who needs it?
Any condo owner needs this type of insurance. The amount they need will vary depending on the value of their personal property, the amount of liability coverage they want, and how much it would cost to rebuild the condo’s interior, if it were destroyed.
How does it work?
Like all insurance, condo insurance requires you to pay a premium. You can usually pay monthly, or all at once for a specified period. When a covered event occurs, you would contact your agent or the insurance company directly, and file a claim. An adjustor would review your claim and look at the damage, and you’d be issued a check for the amount of the damage, minus your deductible.
Why get it?
Repairing the damage to your condo, replacing your belongings, or paying for someone’s injury or property damage, is likely more than you could afford all at once on your own. Insurance protects you from having to bear the brunt of those costs.
Insurance is one of those things that you get in hopes of never having to use it. The expense is worth the peace of mind it brings.