Your condo offers ease, comfort and convenience. Yet condo insurance is a vital (and unfortunately often overlooked) part of owning your home. For example, if a pipe bursts in your bathroom and water leaked down into the unit below, do you know who would be responsible? Or, if an electric fire damaged the wall and carpet, who covers the repairs? These and other scenarios can seem a bit murky to condominium owners, which is why it’s important to be informed and select a condo insurance policy that fits your needs.
Many condo associations in Massachusetts have master policies that cover the property, common areas and physical structure of your building. However there’s A LOT more to your home than that!
That’s where condo insurance (also referred to as H0-6 or “studs in” coverage) comes in. This type of policy is very similar to homeowners or renters insurance, but can generally avoid overlapping with what the association master policy covers.
In selecting the policy that’s right for you, there are several factors to consider:
- First, find out exactly what your master policy does and does not cover. Then take inventory of your belongings and decide what level of coverage will make you most comfortable.
- Some condominium associations have moved to policies with higher deductibles to cut costs. In the event of a disaster and a claim is made under the master policy, each member of the condo association will contribute their portion toward the deductible.
- Be sure to also check whether the master policy coverage will be adjusted if you renovate or make upgrades in your condo—some do, some don’t.
- Though a fixture may have come with your condo, you as the unit owner own everything within the unit, according to some condominium by-laws. This means that permanently attached fixtures or items that would normally be covered by a landlord may be your responsibility to insure.
- Look for the basics: coverage of personal property, personal liability coverage, and coverage of improvements or upgrades.
Getting back to the perks of owning a condo—since you aren’t insuring the entire building with this policy, typically an HO-6 can be fairly inexpensive with a small deductible. Expect it to be a little more than renters insurance, but much less than homeowners!
Since the housing crisis, many lenders require proof of HO-6 coverage for any new condo purchase. Remember to cover the basics beyond personal property damage too—personal and property liability and damage protection from disasters, accidents or violence, as well as improvements or upgrades.
The bottom line in selecting condo insurance is your peace of mind, which comes from the knowledge that your entire home is safe. Learn the specifics of your master policy, ask questions to determine where to fill in the gaps, and rest easy in your protected home.