AS A CONDO UNIT
OWNER, WHAT DO I NEED TO INSURE?
At a minimum you need to
obtain insurance for your personal property, and personal
liability. Personal Property generally consists of
anything that you would take with you if moving to a new
location. Personal Liability affords coverage for injuries
to guests within your unit. This includes furniture,
clothing, contents of your storage locker, and any
appliances that are not built-in. Laws vary by state. Some
states have statutes in place that specify the scope of
insurance coverage that the association master policy is
required to maintain. Some states rely on the association
condo documents in order to establish the insuring
responsibility of the unit owner and the association. If you
are required to insure any elements of your individual unit,
you will need betterments and improvements coverage (See
Coverage A below). A review of your complete condominium
documents is the only way to accurately determine the amount
of coverage needed by each party.
WHAT IS COVERAGE “A”
ON MY UNIT OWNERS POLICY?
This is also referred to
as Building Additions and Alterations Coverage. This
covers for direct physical loss to any part of your unit
that you are required to insure. This would afford coverage
for such things as built-in appliances, cabinets, fixtures,
carpeting, paint and wallpaper. The policy limit will
depend on your requirements as a unit owner.
WHAT IS LOSS
ASSESSMENT COVERAGE:
As a unit owner you
could be subject to an assessment made by your association
for certain losses that are not covered under the
association’s master policy. Some unit owner policies
include a minimal amount of this type of coverage.
Additional limits are available.
WHAT DEDUCTIBLE IS
RIGHT FOR ME?
In recent years,
insurance carriers have offered more favorable rates for
higher deductibles. Increasing your unit owner deductible
from $250 to $500 cold save you as much as 10% of the total
premium.
HOW MUCH COVERAGE DO
I NEED?
Choosing a coverage
limit is an important task. This is determined by such
things as type, location, and quality of construction. It
will also depend on your insuring responsibility as set
forth in your documents.
HOW DO THE
DECLARATIONS EFFECT INSURANCE:
A declaration is a
condominium association’s primary governing document. It
sets forth the insurable interest and requirement of the
unit owners and the associations. All documents are written
differently. The needed limits of insurance are determined
only after careful review of these documents.
