What's covered by a condo association's insurance policy?
Last updated: January 1
A condo association's insurance policy typically helps cover the structure of the building and common areas. The association's policy, however, may or may not extend to the inside of your unit. And its coverage could be dependent on your state's laws. It's important to understand what a condo association's policy covers and how that differs from a condo owner's insurance policy.
The liability protection in a condo association's insurance policy may help cover legal or medical costs if the association is hit with a lawsuit — for example, if someone is injured after slipping and falling in a common area maintained by your association.
Then there's property coverage, which helps provide protection against covered perils for the common areas of the building that you share with all the other residents, like the roof, elevator, basement, courtyards or walkways.
When it comes to your unit, the Insurance Information Institute (III) says in some cases, the association's insurance may help protect the bare walls, floors and ceiling of your condo. You would then be responsible for covering things like kitchen cabinets, appliances, bathroom fixtures, and any plumbing and wiring in your unit with your own insurance policy.
Other times, the association's coverage may help protect your condo as it was built, including fixtures such as the original tub and appliances, according to the III. In this case, you would likely be responsible for the cost of replacing any upgrades in your unit.
The only way to really know which structural parts of your condo are covered by the association is to read its bylaws to learn what parts of your home are covered by the master insurance policy.
What does a condo owner's insurance policy cover?
A condo owner's insurance policy may include the following coverages:
- Protection for your personal belongings against covered losses
- Coverage for damage to the interior of your unit resulting from certain causes
- Additional living expenses if you're the victim of a fire or another disaster covered by your policy. (This coverage is usually available only if the covered loss makes your condo unfit for living.)
- Liability protection to help protect you if you're sued or if you are found at fault after someone has an accident in your unit
You may also want to ask about what other coverages your policy may include. For instance, loss assessment coverage may reimburse you for your portion of a bill split among all condo owners for a covered loss, such as a fire in your building's lobby, the III says.
So, while you may not be shoveling the driveway or mowing the lawn as a condo owner, you still want to take the right steps to protect yourself and your investment in your place.