Finally, after all the paperwork, you have the keys to your new condominium in your hands, and you are ready to move in. The question you should ask yourself is – are you, your home, and your belongings covered? Since most condo owners share insurance obligations with their homeowner’s association (HOA), it can be difficult to know what your individual policy covers.
It is important to understand the difference between a homeowner’s insurance policy and a Florida condo insurance policy. Condo residents generally own their individual units altogether, but have shared ownership (along with your counterpart condo residents) of the condo building/society and its common areas. This is what forms the basis for condo insurance to vary from conventional homeowner’s insurance (because your ownership of many condo aspects are shared with the residents of the building, your insurance responsibilities can get divided up too). The condo policy form is known as an HO6 and is commonly referred to in the industry as “Walls in coverage.” Here is a wide pattern of condo coverage options that step in where your HOA insurance does not:
• Personal Belongings – You will be inclined to want condo insurance to repair or to replace your stuff if it is stolen or damaged. Replacement cost value will pay to replace items at their current value, without bringing in depreciation.
• Interior Structure – Numerous condo owners might not realize they own items such as, flooring, inner walls, countertops, and fixtures. These items are usually not covered under the HOA insurance, so it is up to you to have this coverage separately.
• Improvements – Even if your HOA insurance covers the framework of your home, odds are they will not increase coverage for improvements you make to your home, like adding an expensive item into your home.
• Liability – If your guests are harmed in your home or their belongings are damaged, condo insurance can help cover the bills if you are held responsible. Adding more protection can be done by increasing your current limit.
• Loss Assessment – Loss assessment coverage offers protection (up to the limits you choose on your policy) for damages that you might be held responsible for by your condo society like, damage to a common area.
• Identity Theft – A reasonable, yet useful coverage, this condo insurance add-on will help cover the costs of recovering your identity in case it gets stolen.
• Loss of Use – If your home is unoccupied due to a covered loss, your condo insurance policy can provide added living expenses (any expense that may outpace your ordinary standard of living) or fair rental value so you can maintain your quality of life.
One should know that HOA insurance generally covers:
• Exterior Structure – The outside segment of unit, like walls, ceilings and roof.
• Land – Any injury or harm caused to guests outdoors while being on the property of the condo building or community.
• Common Areas – In a condo building, there are usually “common areas” such as, hallways and lobbies, but in a rambling condo townhouse society; the common areas consist of: pools, tennis courts, or even bike trails. These common areas would usually be covered for property damage and liability.
• Shared Amenities – Shared amenities such as elevators or gym equipment, which everyone in the community uses, would generally be secured by a covered risk if they are somehow damaged.
• Exterior Structure of the Condo – For instance, if a car drove through the outside wall of the condo building, that is typically something that condo owners do not have to cover themselves.