All you need to know about condo insurance
A condominium is essentially an apartment that you own. When it comes to insuring it, it’s a little different than insuring a home or a rental property, however. Here are the important things to know about condo insurance.
What is it?
Condominium insurance is insurance that covers your personal possessions and, in many cases the structures and fixtures as well, such as floors and cabinets. Typically, the owner of the condo building carries a master policy that covers the building structure and common areas, but owners of individual units are responsible for getting their own policies.
Who is it for?
Condominium insurance is for people who own a condo unit. Whether you live in the unit or you rent it out, you need to have coverage for the portion you own.
How does it work?
Insurance for individual condo units covers those units and only those units. Anything that happens outside the unit is covered by the building owner’s master policy. If you have damage or theft to your individual condo unit, you need to file a claim with your insurance company and let an adjuster evaluate the damage. You also should talk with your building owner or condo association to see if any of the damage might qualify under the master policy.
Types of coverage
There are essentially two types of coverage, and which type you need depends on what type of coverage the building owner carries. If the owner carries “all-in” insurance, it should cover the physical structure of your unit, including any fixtures. In that case, you would only need coverage for your possessions, which is similar to renters insurance. If your building owner does not have all-in coverage, it means you need a condo policy that covers fixtures as well as possessions.
The major benefit of having condo insurance is that you ensure anything inside your unit is covered in the event of a fire or weather damage. Don’t assume that anything inside your unit is covered by the building master policy.