Owning a condominium is an exciting step in life. You now own real estate without the hassle of maintaining an entire building or a yard. You get to be a part of a community of people and know that whenever you’re away from home, you don’t have to worry about the state of your home.
One very important decision you’ll need to look at when you purchase your condominium is which condo insurance policy to purchase.
What is condo insurance?
Condo insurance, also known as an HO-6 insurance policy, protects condo units while providing personal liability coverage and living expenses if a condo becomes uninhabitable . Condo insurance protects you and your property financially should anything happen to your unit. If you’re planning to make your condo your permanent home for the foreseeable future, there’s a high chance that eventually you’ll find yourself facing unexpected expenses.
What does condo insurance cover?
Personal Liability Coverage
In case you are at fault for someone getting injured while on your property and decides to take legal action, this coverage may help you cover related legal expenses.
Guest Medical Coverage
This coverage will help cover the medical bills of someone who is injured on your property, whether or not you are at fault.
Building Property Coverage
This coverage will help you pay repairs to the structure of your condo or upgrades that you made, like your built-in appliances and custom hardwood flooring. The extent of your building property coverage depends on what’s already covered by your condo association policy.
Personal Property Coverage
You will need this coverage to protect your personal belongings such as furniture, clothing, electronics, and other contents of your condo that may be damaged. This is usually covered either by cash value at the time of damage (which may be a cheaper plan because it accounts for depreciation) or replacement cost (which may be more expensive because it you don’t have to worry about replacing the items at a depreciated value).
If you’re forced to relocate while your condo unit is being repaired, say, after a pipe bursts and you need to stay in a hotel, this coverage will pay for your living expenses during the repair.
Optional condo insurance coverage
Here are some examples of optional coverages which you can add on top of your standard condo insurance policy:
Loss Assessment Coverage
In case there is damage to a shared space that everyone in the association is required to cover, this coverage may help pay for your part of the bill.
Flood damage is typically not included in your standard condo insurance. 40% of flood claims happen to homes that are not in flood zones, which is not covered by a standard home policy. Luckily, it is typically only around $1 a day to add flood insurance. We highly recommend flood insurance, and we can get you a quote today.
For additional protection, you may want to consider adding an umbrella insurance which goes into effect once you reach your condo’s liability coverage. This can help you pay for large liability claims or judgments.
Your typical condo insurance does not cover earthquake damage. You may be able to add this to your condo policy or you may purchase a separate earthquake insurance policy
Short-term Rental Insurance
If you are planning to rent your condo out as an Airbnb or other rental unit and use it for business purposes, your condo policy will not cover it. You should consider adding short-term rental coverage to your property.
If you want to save money on condo insurance, don’t just pick the first company you find. There are independent insurance companies like G&G Independent Insurance that make it easier than ever to compare multiple companies at once. We will help you find the best rates and create a custom plan so you’re not paying for extras that you don’t need.