Understanding Condo Insurance: What’s Covered and What’s Not?
People in Illinois prefer condos for conveniences like easy access to amenities and low upkeep costs. But with such convenience comes the responsibility of protecting one’s property against unexpected events—starting with comprehensive condo insurance. Getting the right condo insurance coverage, or HO-6 insurance, can be overwhelming as you weigh your options regarding what to include and what to exclude. Don’t worry! This article is here to help you explore your coverage options and make the best choice for your needs.
What is Condo Insurance?
Condo insurance is a specialized homeowner’s insurance designed exclusively for condominium owners. In addition to covering individual, personal property, and liabilities, it is tailored to cover only what the condo owner is responsible for, as outlined in the condominium association’s master policy. The individual condo insurance policy makes sure that your unit is covered by securing it from the shared area, structures, and belongings within its boundaries.
What Does Condo Insurance Cover?
The insurance for condos generally covers your unit, possessions, and liabilities. It is broken down into its key parts:
Dwelling Coverage
The dwelling coverage usually covers the entire interior unit structure, including walls, floors, and ceilings, as well as any built-in fixtures. It is especially important for condominium associations, whose policy only covers bare walls.
Personal Property Coverage
This coverage safeguards your belongings—such as furniture, electronics, clothing, and appliances—against risks like fire, theft, or water damage. With this coverage, you get the flexibility to choose between actual cash value and other options, depending on what best suits your needs.
Liability Coverage
Liability insurance covers you if anyone is injured within your unit or if you harm someone else’s property. For instance, if someone falls and slips, it can help cover medical and legal costs.
Loss of Use Coverage
If your home becomes inaccessible, and that incident is covered in your Loss of use policy, you can get coverage for the temporary cost of living, like, accommodation in hotels.
Medical Payments to Others
The policy covers medical costs if the guest gets injured at your home, and is not at your fault. It’s an excellent addition to help prevent small accidents from turning into larger responsibility lawsuits.
What Does the Condo Association Insurance Policy Cover?
The condominium association’s policy is focused on shared spaces and the structure of the building. Understanding this coverage is vital to identifying the gaps that your condominium insurance policy needs to cover.
Building Coverage
Structures, roofing, and shared infrastructure typically cover the exterior of your unit. Depending on the type of insurance and extent of policy coverage, it could also apply to specific areas of your home, such as wiring or plumbing.
Common Areas
The condominium association’s policies cover common areas, including corridors, lobbies, and hallways, as well as pool areas and fitness centers. After damage, these areas will be fixed or rebuilt.
Liability Coverage for Common Areas
When someone gets injured in a public space, such as due to slipping on unclean lobby flooring, the association’s liability coverage covers medical bills and legal costs.
What Condo Insurance Does Not Cover
Flood and Earthquake Damage
Condo insurance policies typically do not cover flood or earthquake damages. Separate policies or endorsements may be necessary to safeguard against these risks.
Wear and Tear
Older appliances cannot be covered for wear and tear or other maintenance problems, such as leaky pipes.
High-Value Items
Fine art, jewelry, collectibles, or other fine art could exceed the coverage limit for your personal property. Consider scheduling these items to provide extra insurance.
Damage to Common Areas
Repairs to common areas, such as roofs or damaged lobbies, can be covered under the policy governing the condo association. However, they are not insured by the condominium’s personal insurance policy.
Tips for Choosing the Right Condo Insurance
Finding the ideal condo insurance policy takes an attentive consideration of your requirements as well as the coverage of the master policy.
Here are some suggestions to help you choose:
Understand the Master Policy
Examine your condominium association’s master policy to identify coverage gaps. It can help you determine the areas that your specific policy must cover.
Assess Your Risks
Be aware of potential risk factors specific to your location of residence, lifestyle, or the structure’s health. If, for instance, you live in an area with a high risk of flooding zone, additional flood insurance might be required.
Inventory Your Belongings
Make a comprehensive list of your belongings and determine their worth. This will help you obtain sufficient protection for your personal property.
Bundle Policies
Numerous insurance companies offer discounts when condo insurance is combined with other policies, such as automobile insurance. It could save you money while reducing the stress of managing your policy coverage.
Consult a Professional
Contact a professional insurance broker or agent for a customized policy tailored to your specific needs. Abe GT & Associates can provide expert advice and ensure your protection is fully secured.
Condo insurance is important for protecting personal belongings and investments. However, the condo association’s master policy only covers common areas and the building’s exterior. An individual policy provides coverage inside the unit, ensuring comprehensive protection. Therefore, it’s advisable to understand both policies to avoid surprises.
If you are in Illinois, you can visit us or call us at (312) 738-1384. Abe GT & Associates are licensed insurance agents in Illinois, Michigan, Wisconsin, Indiana, North Carolina, California, Texas, Arizona, Maryland, and Ohio. Our experts help you get tailored condo insurance solutions that fit your needs and budget.
