Condo Insurance Options

You need to determine what your condo association’s master policy covers before you go shopping for your own policy to cover the rest.  It is a mistake to assume that the only insurance you’ll need for your condo is the master policy owned by the association.  Master policies cover very little in comparison to what you actually need coverage for.  Here is a short list of things you should know about in regard to shopping for a condo insurance policy.

Master Policy

The owners and renters in a condominium complex will split the cost of a master policy, but these don’t cover everything.  They will usually cover the grounds, the structure, and the common areas with liability insurance.  This means that you will have coverage if something happens to a third party while in the public areas.  The master policy, however, doesn’t cover any incidents in your personal space.

Private Policy

If you want to ensure that your personal space is covered you will need your own policy that covers these damages.  What you will get will be coverage for natural disasters that cause damages to your condo and your belongings.  You will likely have to pay for a separate policy if you want protection from flooding, earthquakes, or if you use your condo for business.

Additional Options

One of the options you should seriously consider is the one that will protect your belongings.  Your basic policy will probably include an option that will provide you with a payout of 25 – 50% of your policy’s value for your contents but this is often not enough.  You should, instead, consider purchasing a separate contents insurance policy to fully cover your belongings at replacement value. 

For instance, your computer may have been purchased 10 years ago for $1200 but you can currently get a brand new, faster computer for less than $400.  Conversely, you may own a table and chairs set that you bought at a yard sale for $50 but it will cost around $300 to replace this set brand new.

Contents coverage will also only cover your collectibles and expensive items (high end electronics, furs, and jewelry) for a limited amount.  If your diamonds are worth $10,000 and your son’s Star Wars or Star Trek collection is worth $7,000 you may only get up to $3,000 for both sets with a regular policy.  Consider an additional policy or add-on coverage for more if you own anything like this.

The last thing you can do to if you want to save a little money on your policy, especially if you need to add-on any of the above options is to agree to a higher deductible.  Make sure, though, that you will be able to afford both your private deductible and that of the master policy in the event you need to pay both at the same time.