Investing in a condo definitely has its perks, such as reduced maintenance and building amenities like fitness centres and swimming pools. However, there is one thing that can cause a headache, which is homeowner’s condo insurance. Insurance with condos works differently than with detached homes, so it’s important to go through the details and find out what type of policy you need. To help get you started, here are a few commonly asked questions about whether you need insurance if you own a condo.
If the building is insured, do I need condo insurance?
Don’t assume that you don’t need to buy insurance for your condo because the condominium corporation already has a master insurance policy for the building. The existing building insurance will only cover parts of the building, such as the common areas, elevators, parking and amenities. If you don’t have condo insurance, you could be held personally liable for any injuries caused to other residents or visitors of your home, and your personal possessions may not be insured in the event of condo theft or damage. If something happens and your condo is rendered unfit to live in, your condo insurance will cover any additional living expenses incurred from this event.
What level of coverage should I take out?
When choosing condo insurance, it’s important to evaluate your contents and existing coverage before you decide the level of coverage to take out. The building may be covered by one of two master policies: a bare-walls policy, which covers the bare walls and floor and structure, and an all-in policy, which covers things like basic fixtures, appliances and countertops. It’s important to do your research and find what the building’s master policy covers before you take out your condo insurance. Your insurance should cover everything that’s in the apartment, including personal possessions, furniture and anything else. Remember to adequately insure your belongings and have them itemized and valued so you know exactly how much coverage you need.
What about the association deductible?
Another thing to consider is the master policy deductible. If there is an insurance claim through the building’s master policy, the residents are expected to equally share the cost of the deductible for the claim. The price can vary depending on the extent of the damage – the claim could be anything from $10,000 to $100,000 – and although it will be split across all residents, it’s still a cost to factor in. You can add a coverage rider to your condo policy so that your insurance company will pay your share of the deductible. You also need to understand the ins and outs of the master policy and what you may be liable for, such as flooding caused by an overflowing bathtub in your condo or a burst pipe in your unit.
We’re here to help answer any of your questions relating to condo insurance. Drop us an email or give us a call today to address and queries you may have about your new home!
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