Condo Insurance – What should I consider when purchasing?
December 13, 2009 by
Filed under condo insurance
Looking to buy condo insurance in NYC, any tips, suggestions and best practices welcome.
December 13, 2009 by
Filed under condo insurance
Looking to buy condo insurance in NYC, any tips, suggestions and best practices welcome.
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If your condo is in Massachusetts, you would first ask your condo association for the name of the insurance agent that has their master insurance policy which covers the entire condominium. Request a copy of the binder of the master policy. Provide this binder to your own personal insurance agent, and ask your personal agent to provide you with coverage for your unit that the master policy does not cover. As a general rule, the master policy will cover the condominium up to the studs in your unit, but you will have to obtain coverage for everything inside your unit, possibly including the sheetrock in your unit. Hope this helps.
The master policy usually does not give the information about what is covered. It is stated in the bylaws of the association. Each association is a little different. There are usually three ways that the bylaws will read 1. Everything on the interior is covered except your personal property. 2. Everything on the interior is covered except improvements or betterments that have been made to the property. 3. The studs out, the sheetrock in is your responsibility.
In #2 and 3 you can add coverage to your personal condo policy to cover the building items that are not covered by the condo master policy.
I have see twists to the bylaws. One stated that everything is covered except wall coverings and floor coverings. You really need to get ahold of the bylaws (make sure it is the most updated set of bylaws) and look for the section labeled insurance. If it doesn’t make sense to you bring it in to your insurance agent and they can help you with it.
I personally, will not write a condo policy without seeing the bylaws first.
For your personal property, it is really no different than deciding how much coverage you would need if you were taking out a renters policy. I tell people “If your place burned to the ground tonight, what would it cost to replace everything you own” You need to make sure you take into consideration all of your clothes, shoes, pots, pans and everything that is in your drawers and closets. It’s all of the little things that will add up quickly.
You need to sit down and talk with a local, independent agent. You want to be sure you cover any permanent additions & alterations you do to the structure (wall to wall carpet, wallpaper, built-ins, etc), as well as include “loss assessment” coverage.
After that, it’s just the same as basic homeowners – include backup of sewers & drains, replacement cost contents, adequate liability limits, etc.
Okay. To be honest, this is a question that the Condo-owners Association normally doesn’t understand themselves. The answer to your question, lies in the Condo. Assn. Documents. It’s in the “doc’s” under headings, like “Insurance Requirements” or some similar verbage. Now the “doc’s” can be some 300 or more pages, so a little investigation is necessary.
You should go to a large, well known property insurer for the state of New York. It may cost a couple of bucks more a year to do this, but believe me, It’s worth it if you have a claim….Ask the agent for a “Condo-Owners Policy”. Now, I am assuming that you own the condo. If you are a renter, then the whole story changes, but…
The HO-6 Condo policy, will cover, pretty much, whatever the Condo Association policy doesn’t, as far as, your property. From, floor and wall coverings to the comforter on your bed, though these are separate parts of the HO-6 policy. The policy is broken down into 5 basic coverage sections.
A – Building Items (Kitchen cabinets, floor & wall coverings,sinks, Vanities, Etc..)
B – Other Structures ( Sheds, Fences, etc…)
C – Personal Property (From your best pair of shoes, to your toothbrush)
D – Additional Living Expense ( If your house is too damaged to live in)
E – Personal Liability ( Anything, legal, that you might be “legally liable” for. This coverage also includes “Medical Payments to Others” coverage, if someone slips and falls at your home, or the like.
The coverage you purchase, will normally be based on the “Coverage A Limit”. So if it would only take $50,000 to rebuild the inside of your condo, you may only get $25,000 for “Personal Property” coverage. If you need more, it can be purchased.
Was that a long answer to a short question?
Go find a good local agent, and make him /her explain the coverages. If they can’t do it, you might just want to keep looking……You could already know more about it than them.