What to Know Before You Buy Condo Insurance

Learn the basics of a homeowner’s policy before you buy condo insurance. Condo homeowner’s insurance protects the unit owner and is different from the condo association’s insurance policy. Condo insurance is designed specifically for condo owners. Below you will find everything you need to know before you purchase condo insurance.

The Condo Association Insurance Policy

To understand what a condo owner’s insurance policy covers, you first need to understand what the condo association insurance policy covers. Your condo association should carry an insurance policy that provides liability protection for accidents and injuries that occur in the common areas, coverage for the exterior of the building or buildings, and coverage for the general condo property. The insurance policy of the association does not cover the contents of your home, property damage that occurs inside your home, or liability claims if someone is injured inside your home.

Condo Insurance Coverage Basics

Your condo insurance will protect the contents and interior structure of your home. The policy will also provide liability coverage in the event that someone is injured inside your home. Commonly, insurers exclude flood and earthquake coverage from a standard condo insurance policy. Your policy may also exclude personal injury to the homeowner and business use for a home office. You should check with your insurer for the specifics of policy exclusions.

Condo Insurance: Additional Coverages

Some insurers allow you to purchase the following additional coverages to supplement your condo insurance policy:

• Replacement cost. Reimburses you for the full cost of replacing your damaged or stolen personal belongings rather than the depreciated value of the items. This coverage is more expensive but will allow you to purchase new-model replacements for your possessions.
• Personal property floater. If you have very valuable items, such as jewelry, furs, collections, etc., a standard condo insurance policy probably won’t provide full protection for them. In this case, you might want to consider a personal property floater to increase your coverage limits for these items.
• Discounts. You can get many of the same discounts on condo insurance that are available for homeowner’s insurance. For example, you might receive discounted premiums for smoke detectors, anti-theft alarms, and multiple policies.
• Flood & earthquake insurance. If you live in a flood zone or an area prone to earthquakes, you might consider adding these coverages to your policy.

Additional Resources:

• Home Owner Insurance FAQ
• Condo & Co-op Insurance