Content courtesy from the Economical Insurance website.
So, you’re finally ready to buy that condo you’ve been dreaming about — and it’s time to shop for a condo insurance policy. Before you take the plunge, let us make it a little easier by breaking down five of the most common myths about condo insurance.
“My condo corporation already has insurance, so I don’t need to buy my own coverage.”Unfortunately, your condo corporation’s master policy probably isn’t designed to protect you, your belongings, or improvements you’ve made to your unit — it likely only covers damage to the building and items in common areas, like the lobby, rooftop patio, or gym. Each unit owner should have their own condo insurance policy to protect what’s inside their own unit.
“Condo insurance will only protect my stuff, so I don’t need it.” Condo insurance protects so much more than your stuff. Like home or tenant insurance policies, condo insurance policies generally cover liability claims, additional living expenses, and even identity theft. Condo insurance also tends to include coverage for the additional cost of improvements you’ve made to your unit, loss assessment (when your condo corporation’s insurance isn’t enough to cover damage to common areas and each unit owner has to cover a portion of the losses, for example), and unit additional protection (if your condo corporation has no insurance or if its insurance is inadequate to repair damage to your unit).
“A condo insurance policy will cover everything in my unit, including fine jewelry.” Most condo insurance policies have a special limit for all of your jewelry combined, including watches, gems, and fur or fur-trimmed items. If your jewelry adds up to a higher amount than the limit stated in your policy, you should consider adding additional coverage.
Did you know your policy may also have special limits for items like fine arts, coin and stamp collections, sports cards and other collectibles, computer software, silverware, and more? Reach out to your broker to make sure you’ll be fully covered in the event of a loss.
“My condo insurance policy covers all kinds of water damage.” Generally speaking, coverage for damage caused by sewer backups or overland water (including overflow from lakes and rivers, heavy rain, and spring run-off) is not automatically included in most home or condo insurance policies — but it’s often available as an add-on.
“If I decide to rent out my condo, my rented condo insurance policy will protect my tenants and their belongings.” As a landlord, your rented condo insurance policy is likely designed to cover damage to the unit and your appliances — but your renters will need tenant insurance to cover their own belongings, liability claims, and additional living expenses. Avoid a potential dispute down the road by telling your tenants about the benefits of tenant insurance today.
When you’re shopping for condo insurance, be sure to connect with a licensed broker. Your broker will do the research for you, comparing coverage and prices from several insurance companies to make sure you get the right coverage to suit your needs.