Condo owners have several coverage options when it comes to their insurance. They can choose between bare walls policies, all-in policies, and original specifications policies. Typically, homeowners’ insurance covers personal liability and personal property. However, it doesn’t cover the structure of the building or the common areas.
Coverage Options
Choosing the right insurance for a condo King George, VA policy depends on personal needs. Shopping around for the best prices on the coverage you need is essential. Some factors that influence costs include location, the type of master policy, and your credit history. When shopping for an HO-6 policy, consider how much it would cost to rebuild your condo. Typically, this is based on square footage and finishes in rooms like kitchens and bathrooms. Consider adding building property coverage, which covers additions and improvements not covered by the association’s policy. Also, choose liability limits high enough to protect your assets. Depending on your net worth, an umbrella policy is another option for added protection. Some insurers offer multiple policies and discounts, making keeping your policies with the same company easier.
Deductibles
Depending on your chosen policy, your personal property coverage will pay for items up to a certain dollar amount based on their depreciated value. To avoid being underinsured, consider taking a home inventory and purchasing replacement cost coverage if available. Individual condo policies also offer to build property coverage for improvements and additions the unit owner makes. This includes upgrades like kitchen cabinets, countertops, and appliances. It can also cover the condo’s bare walls and wall studs in case of a loss not covered by an association master policy, such as a fire. Loss assessment coverage — sometimes called special assessments coverage — is an add-on that helps cover the costs of a shared loss for which your condo association might be liable. It typically covers a portion of the damage costs to shared areas like hallways, elevators, gardens, and rec rooms.
Policy Limits
Condo owners must determine the value of the personal and building property they’re responsible for and purchase enough coverage to replace those items in the event of a loss. To do so, they should take a home inventory. There are a variety of apps that can help with this process. When selecting a policy, homeowners should choose replacement cost rather than cash value reimbursement, as the latter only reimburses for an item’s original purchase price minus depreciation. They should also consider the amount of loss assessment coverage in their policy. Some insurance companies include this, while others may offer it as an add-on. If a condo association goes over the limits of its master insurance policy for a covered loss, individual condo policyholders might need to contribute. This could be a significant expense, so a policy with high loss assessment limits is ideal.
Additional Coverage Options
There are a few additional coverage options that can be helpful for condo owners. For example, loss assessment coverage can help pay for damage to shared areas of the condo building, like the lobby, hallways, and standard rooms, when the association’s master policy doesn’t cover it. Other optional coverages include personal property replacement insurance, bare walls coverage, and living expense coverage. Personal property replacement insurance typically pays for items based on actual cash value (ACV), but you can also opt for replacement cost coverage. Bare wall coverage helps protect things inside your condo that aren’t covered by the association’s master policy, including drywall, plumbing, and wiring. And living expense coverage pays for expenses incurred if you temporarily live somewhere else after a covered condo loss.
Policy Exclusions
Unlike home or renters insurance, condo (HO-6) policies aren’t one size fits all. Condo owners must review their association master policy and personal condo insurance coverage to ensure they have the right mix of protections. Bare walls or all-in coverage is typically included in condo policies, which cover property damage and liability risks inside your condo. You’ll also decide on personal property floaters (to increase coverage limits for non-standard or valuable items like musical equipment, jewelry, and artwork), building property coverage amounts based on the value of your belongings, and actual cash value or replacement cost reimbursement. Most condo insurance includes personal liability coverage, which pays for damages to guests while they’re in your condo. Other standard options include living expense coverage that helps pay hotel bills if your condo is uninhabitable due to a covered loss.