panda7's Condo Insurance Guide
Home insurance is not the same as condo insurance. While home insurance can cover your liability, the contents of your home, and the physical structure of your unit, condo insurance is generally designed for the interior of your condominium and your personal liability only. Why? Because most of the exterior or "common" areas of your condo will be covered by your condo association's "main" policy.
We understand that condo insurance can be confusing for some, which is why we've decided to answer all the most frequently asked questions about it. Here's everything you need to know about condo insurance, and more.
What is condo insurance?
Condo insurance is a policy you purchase that provides coverage to fill in gaps and address risks that the condo association's primary policy may leave unaddressed. While it depends on the amount of coverage you buy and what the primary policy already protects against, your average condo policy might include coverage for your utilities and appliances, the interior walls of your individual unit, and your personal belongings. In addition, your condo insurance also protects your personal liability in case you are responsible for someone else's injuries or property damage.
Why is this important?
Condo insurance is important because many condo owners assume their condo association's main policy will cover them. This is true to some extent, but it leaves out certain features of your individual unit, your amenities and belongings, and your personal liability. Without condo insurance, you may have to pay for these items on your own.
What does condo insurance cover?
Your condo association has a primary policy that may cover all the original appliances, systems (wiring, plumbing), and furnishings in your individual unit, as well as common areas, or the "bare minimum" policy, which doesn't include anything inside your unit but covers common areas and the condo association's liability. You can choose to review your condo's primary policy to ensure that the condo insurance you purchase will cover anything that this policy doesn't.
This should include,
- Your personal unit, if your condo's main policy omits it
- Your valuables and possessions
- Your personal responsibility
Essentially, you'll want your condo insurance to cover any gaps left by the condo association's primary policy. You can enlist the help of a broker to ensure this is done correctly.
Does this include my valuables?
Your condo insurance will include coverage for your personal belongings up to a certain limit. It doesn't hurt to make an inventory of everything you own to assess whether your coverage is sufficient.
You can purchase an endorsement or "float" insurance (as it's sometimes called in the insurance industry) to include your valuables or expensive collectibles if your existing coverage isn't sufficient. You may want to consult your insurance broker to review your needs and help you choose the plan that best suits you.
What does the "main condo association policy" cover?
Your condo association's primary insurance policy can be one of two types: it can cover your condo's appliances and fixtures, carpets or flooring, and plumbing, but exclude your personal belongings. This is sometimes called an "all-inclusive" policy. Or, your condo association's primary insurance policy can be a "bare walls" policy, meaning it won't cover anything inside your building's walls. This may sometimes include your condo's systems, but sometimes not. Regardless of the type of policy, it will include coverage for common areas and the condo association's liability.
Does condo insurance cover…?
Appliances and public services?
Sometimes. Depending on your condo association's primary insurance policy, you might have coverage for your utilities and appliances if they are original to the condo. If you own your utilities and appliances, or if your primary condo association policy doesn't cover them, you may be able to cover them under your own condo insurance policy.[H3] Mold growth?
Mold growth?
Many condo (and home!) insurance policies exclude mold from coverage. This is usually because mold growth results from a lack of maintenance or an unoccupied/vacant condo. In some circumstances, you might be able to successfully file a claim, such as if a pipe bursts unexpectedly and the resulting water damage causes mold to grow. If the mold appeared as a result of a flood, it likely won't be covered because flood damage or flood insurance is a separate policy that requires an additional purchase.
Vandalism and theft?
Vandalism, burglary, and theft are included in your condo insurance if you have personal property coverage. This can even extend to items stolen from your vehicle, just as homeowners insurance can cover personal belongings in your car. There are always exclusions, especially with higher-value items. You may need to inquire about an endorsement or rider for full coverage if you own valuables.
Always make a complete inventory of everything you own so you know what coverage you need and what its total value is. You can then adjust your policy accordingly. Condo owners are often surprised by the total value of everything they own!
Natural disasters?
Major storms like windstorms and tornadoes are covered for your belongings and the interior of your condo, unless your condo association's primary insurance policy already includes coverage for this. Your primary condo association policy may also cover damage to plumbing, wiring, fixtures, etc.—but you should check beforehand and make sure your condo insurance policy covers all gaps.
How much condo insurance do I need?
Everyone needs a different amount of condo insurance depending on their valuables and what the condo association's main policy includes/doesn't include. You might want to inventory all your belongings and calculate the total cost to replace them in their current condition after a loss. Some valuables may even require additional coverage.
A broker will be able to help you determine your needs and discuss your coverage requirements with you. They can help you find the right policy that fills any gaps left by your condo association's primary policy and protects your personal property, investments, and personal liability.
How much does condo insurance cost?
The cost of condo insurance varies depending on the location, the condo itself, the value of your personal belongings, and the coverage you choose. You can get a quote from an insurance broker (like Panda7) to estimate the overall cost of your condo insurance. Generally, a condo insurance policy can cost as little as $20/month, averaging between $25 and $35/month. You can expect to pay more or less depending on your coverage limits and options.