Ensuring proper coverage for your new condominium may involve getting multiple policies. If you have experience only with renters or home insurance policies, it may not be apparent. There are primarily two types of coverages: an individual unit owner’s policy and a master condo policy.
The condo association covers parts of your unit, like floors, ceiling, and bare walls in the former. You will be responsible for several things, such as plumbing and wiring or kitchen cabinets. Sometimes, the association’s coverage may include fixtures like appliances. You can balance ownership and liability with a condo association or condo master insurance policy.
Individual Unit Owner’s Policy
As the owner of your condo, you are responsible for the unit. This policy offers accident liability protection within the walls and protects your personal belongings. It provides personal liability coverage in the event of any claim alleging your responsibility. This policy is similar to homeowner’s insurance and covers repairs or replacement of your personal belongings.
Since you own only part of the property, you may have to take two policies. The condo association or mortgage lender also makes it a requirement. The next piece of insurance is what the association provides: master condo policy.
Master Condo Insurance Policy
The HOA or the condominium association holds the condo master insurance policy. Your premium comes out of the maintenance fees or when you pay your association dues. The master condo policy covers two primary risk areas: general liability and property damage coverage. Common areas like stairways, recreation rooms, hallways, exterior walls, and the roof are covered for damages.
However, the general liability for the association and damage coverage differ with policies. They also differ as per the level of protection they provide. For instance, some policies include cabinetry, counters, and floors inside your unit. Hence, the condominium master policy benefits both the association and the unit owner. The only difference is in what coverage you will get.
What Does the Condo Master Insurance Policy Typically Cover?
Owners and associations have to understand the responsibilities of one another. From a legal and domestic standpoint, it is crucial to address any gaps. And condo master policy does precisely that. It covers:
A condo master insurance policy helps the owner in getting full coverage for their property. Multiple owners use various common condo-attached structures like the pools, gyms, event spaces, or offices. Other general shared spaces include stairways, parking lots, common hallways, walkways, and green areas like parks.
Like with any policy, many types of coverage are available. This policy mainly covers your unit and your personal belongings. You are responsible for insuring your possessions against theft, fire, vandalism, repairs, damage, or loss. These items include furniture, electronic equipment, etc.
Some may reimburse certain expenses if your unit becomes uninhabitable by a peril when you are away. If you sustain physical injuries or cause damage to someone’s property, it covers settlement and medical costs.
Types of Condo Master Policy Associations Have
“Bare Walls-In” policies cover the actual condo structure. It protects the exterior, wiring, piping, roofing, etc. The interior elements of the condo unit, such as the fixtures or appliances, are not covered. You will need a higher level of coverage on your unit insurance.
With “All-In” policies, your condo’s interior elements are covered. If they get damaged by fire or other perils, the policy covers most of your items. These include appliances, countertops, fixtures, installations, floors, interior walls, and so on. You get a higher level of interior unit protection. Hence, you can choose individual homeowners insurance with limited coverage.
All unit owners may have to pay the association for group master insurance policies. If the condominium structure gets wind damage, the community association can claim against it. These policies feature association deductibles, which are also spread among all unit owners.