If you live in a condo, you need insurance just like you would for any other home. Due to the unique structure of condos, condo insurance is a separate type of insurance from home insurance or renter’s insurance.
Who Does Condo Insurance Protect?
Condo insurance is for the owner of a condo living in a condo building. If you rent your condo, you need renter’s insurance. If you’re renting your condo out, you may need to switch to the landlord’s insurance. If you’re the condo association, you’ll need condo association coverage.
Do You Have to Buy Condo Insurance?
Condo insurance is always a smart idea to protect your investment in your condo and the belongings inside. If you took out a loan to buy your condo, you might need to carry condo insurance as a condition of the loan to protect the lender against the loss of the collateral. Your condo association bylaws may also require you to carry a certain type and amount of insurance.
What Does the Condo Association Insurance Cover?
Your condo association should carry insurance for the building and any other common areas. This includes things like the roof, elevators, swimming pools, and other areas. It also includes liability protection for incidents that happen in common areas. It does not include things that happen to the inside of the unit. Exactly where the association’s insurance stops depends on the type of policy.
- Bare walls coverage provides coverage up to the walls. Anything that happens outside of your unit is the responsibility of the condo association. Any damage that occurs inside of your walls is your responsibility.
- Single entity coverage adds coverage for permanent fixtures inside of your unit. This can include things like lighting and certain appliances that are permanently attached.
- All-in coverage is like single entity coverage but extends to anything that’s owned collectively by the condo association as a whole rather than by the individual owner.
For both single entity and all-in coverage, the coverage usually only applies to things that everyone has. If you replaced items installed by the condo association with your own upgrades, you likely wouldn’t be covered by the association policy. Always verify the details of your association policy to see what coverage you may need.
What Does Your Insurance Cover?
Your condo insurance will have several coverage options. The main difference between condo insurance and home insurance is that you won’t be covering the structure itself.
Building property covers any structural components and permanent fixtures that might not be covered by your condo association policy. This can include interior walls, electrical wiring, plumbing, and anything that’s permanently installed.
Personal property covers the items that aren’t attached to the building. This can include your furniture, clothes, and electronics.
While your condo association should have insurance to cover exterior damage, there’s a chance that some damage could be excluded or that it could exceed the insurance limits. If your condo association needs to make an assessment to cover these costs, loss assessment protects you. Note that this only applies to covered claims, like disaster damage, and not surprise assessments for things like the association not correctly budgeting for a routine roof replacement.
Loss of Use
If you’re unable to remain in your condo during repairs or rebuilding after a covered claim, loss of use pays for your additional living expenses. This might include hotel bills, a temporary rental, or extra food costs.
Personal liability protects you against lawsuits directly against you. This might be if someone gets hurt in your unit or if you’re directly responsible for someone getting hurt in a common area. It can also include accidental property damage that you cause, such as starting a fire that spreads to another unit.
Earthquakes and Floods
Earthquakes and floods are generally excluded from the standard condo insurance coverages. So even if you have personal property coverage, you won’t be reimbursed if an earthquake or flood caused the damage. You can get coverage for earthquakes and floods by adding these options to your existing policy or as a separate policy.
Unoccupied and Vacant Unit
One of the most significant benefits of condo living is being able to travel without worrying about mowing the lawn plus a much lower chance of someone noticing you’re gone and breaking in. However, leaving still comes with risks like not seeing a leak in time to stop more severe damage. If you leave for a lengthy period, such as longer than 30 days, your condo insurance may exclude certain types of claims. Unoccupied and vacant condo insurance gets that coverage back.
How Much Does Condo Insurance Cost?
Condo insurance is typically much more inexpensive than home insurance since coverage for the building is covered by your association fees rather than your own insurance policy. The exact costs may vary based on the value of your unit, the type of construction, your location, and your claims history. It also depends on the coverages and limits you choose. If you need other insurance, such as car insurance, you may be able to get a bundle discount by buying both from the same insurance company.
Talk to Your Insurance Agent
Your independent insurance agent can help you figure out how much condo insurance you need and where to find it. Sagen & Associates Insurance has locations in Kenosha and Brodhead, WI. If you’re in the area, contact us now to request more information or to start your quote.