One of the most misunderstood aspects of condo ownership is insurance. Many new condo owners mistakenly believe that insurance is not needed since condos carry a master insurance policy. To protect your property and your interests, here are several reasons why you need condo insurance.
1 – Master Insurance Doesn’t Cover Interiors
Although the condo association carries master insurance, this might not be what you think it is. Master insurance typically covers common areas, like the building structure, hallways, etc. Within your individual condo unit, whether it’s connected to other units or free-standing, this insurance policy normally only covers the exterior and the wall studs. This means that the actual drywall and everything within the unit such as fixtures, floor coverings, etc. are NOT covered by Master Insurance. You need a condo insurance policy to protect those interior elements and to restore your unit to its original state should damages occur.
2 – Mortgage Companies Require It
If you purchased your condo with a mortgage, the mortgage company will require you to purchase condo insurance. Since they are lending you money based on the value of then entire property (including interior fixtures and furnishings), they want those protected in case of fire or other extensive damage.
3 – Your Personal Belongings Need Protection
Beyond the condo itself, you must also consider your personal belongings. This includes furniture, electronics, jewelry, bedding, etc. Condo insurance policies come with coverage for your belongings up to a certain amount. You should review this information carefully and consider increasing coverage for expensive items like collectibles or artwork.
4 – You Need Liability Protection
Another important feature of condo insurance is personal liability protection. If someone gets injured at your condo, you could be held personally liable for their injuries. For instance, a visiting friend falls down your stairs or gets food poisoning from a meal you prepared. You could end up paying their medical bills, lost wages, legal fees for your defense, etc. Personal liability protection is essential for anyone who owns or rents any type of property.
Summary of Why You Need Condo Insurance
Although condo insurance may be optional in some cases, it really isn’t. Unless you have wealth and can cover the cost of restoring your condo unit, replacing all of your belongings, and personal liability for injuries to others, then you need condo insurance! It’s actually not as expensive as you may think. Contact us for a free condo insurance quote.