A condo owner is responsible for insuring everything within the walls of his or her condominium. The rest of the building, everything that condo owners share, falls to the condo association to be insured. The purpose of a condo association is to represent the needs of the condo owners, as well as to protect the property as a whole. That is why it is necessary to have condo association insurance. There are many things that can’t always be anticipated, so you want your insurance to protect you in the event of such circumstances, even the ones you don’t think about.
There are basically two kinds of master policies for condo association insurance. Bare Walls-In covers the property from the exterior to the inside, but doesn’t cover kitchen and bathroom fixtures, granite countertops and other things within the condo unit. All-In is a policy that covers all interior fixtures, walls, floors and ceilings.
There are many things a condo association policy should cover, including:
Building Coverage. This relates to the master policy, providing coverage for the building structure and anything attached to it. This could be flooring, fixtures, cabinets, or architectural details, depending on which master policy you have. It also covers common buildings where condo owners may congregate, such as a lobby area, mailroom building or indoor pool building. Anything that is considered part of the property would be included in building coverage. Coverage for drain and sewer backups will pay for accidental damage at your building.
Liability. First, you need liability to protect from claims made against members of the association board. Comprehensive general liability helps protect you from legal issues caused by property damage, personal or bodily injury and other related things.
Protection from Dishonest Employees. This coverage is helpful in case an employee steals money or important documents.
Ordinance and Law Coverage becomes necessary if the condo association needs to hire contractors to work on renovations, painting or other services—this will cover the cost. It will also cover costs incurred for repairs in the event the property is damaged. You will also have protections against weather events, such as hurricanes and tornadoes. Flood insurance may be mandated if you live in a flood zone. Otherwise, it’s an optional, but important, item to consider having in your policy.
Replacement cost will pay for the cost of damaged property, depending on the policy limitations. You’ll want to make sure you have inflation coverage as well. This will increase the amount of insurance on your building and association’s property to keep up with inflation.
There are other coverages that should be included in your policy, including Loss of Income. Up to a year of lost income will be covered if the business can’t operate due to some accident or loss that the policy covers.
For all of your home, auto and other insurance needs, please contact Zawada Insurance Agency. We work to give you comprehensive coverage at a competitive price.
Zawada Insurance Agency, Inc. is a family-owned and operated independent insurance agency, located in Worcester, Massachusetts, serving central Massachusetts and beyond.