No one really likes talking about insurance. But when you’re a property owner, you have to make sure you are covered by crucial insurance policies in case you experience loss, damage, or injury of someone in your home or yard.
When you own a condo, the insurance process can be a bit more complicated than simply purchasing coverage to protect your assets. That’s because there are two types of condo insurance: the HOA master policy and the personal policy you hold.
HOA Insurance Policy
Your HOA’s master insurance policy covers the exterior of your property. That includes:
- Land: the outside of the community or condo building.
- Outside structure: such as any damage to the roofs or walls
- Shared amenities: including gym equipment or elevators that are used by everyone
- Common areas: like pools, lobbies or always, bike trails, tennis courts, etc
Condo Insurance Policy
The insurance you must have as a condo owner is typically for covering the inside of your unit. That includes areas like:
- Interior structure: such as inner walls, flooring, fixtures, and countertops
- Personal belongings: to replace or repair anything damaged or stolen
- Loss assessment: for damages that your condo association could hold you responsible for, such as something happening to a common area
- Liability: in case your belongings become damaged or guests suffer injuries on your property
- Loss of use: any additional expenses of living (besides what is needed for average standard of living) or above fair rental value in case a covered loss makes your home uninhabitable
As it seems, the HOA insurance policy would widely cover the exterior of each unit and the condo insurance policy would cover a lot of the interior. Maintenance fees collected by your HOA or homeowners association management company could be what pays the HOA insurance policy. Although this can be exactly these case in some communities, its not always true. That’s why it’s so important for each property owner to read their association’s CC&Rs very carefully to know how things are handled and understand what level of insurance is required.
It can be frustrating paying for condo and HOA insurance if you don’t think you’ll ever have to use it, and don’t want to think about a situation where you do. But regardless, it’s worth the peace of mind and financial protection in case something does come falling down on you.