4 Ways Condo Insurance Differs From House Insurance

When you own a condominium, covering risks through appropriate condo insurance is not an option, it is required by each of the 50 states. While condo insurance is similar to home insurance because you need to cover both your property and liability risks. While the coverage appears very similar on the surface, the way your premium is determined is very different when you live in a condo as opposed to a single-family home.

You Have Less Options

While your Home Owners Association will not likely restrict you to only one insurance company, you may have to work with a company it approves. For example, your HOA may say you need to be insured with an A rated insurance company. It is also possible you will have arrangements with a particular insurer for a discount through your company, and you may want to take advantage of this even if it is not your previous insurer. Your HOA may also tell you how much coverage you must carry in your limit amounts. This is to protect other members of the building if you sustain damages in your unit and those carry over into other units.

Theft & Liability Are Higher

Because you share a building with other people, your insurance company will charge you more to cover for some common problems. Sharing a building increases your exposure to petty theft. Other people will have access to your building, and those people may not always be friendly neighbors. It is common for thieves to attempt to gain access to a building in order to check for unlocked doors and burglarize individual units. You will also have a higher exposure to liability. Any accident that occurs in your unit, like a fire or flood, will ultimately affect your neighbors.

Facilities Come into Play

You may reduce the exposure you have to theft and liability by electing a safe, well managed building. If your building is monitored by security guards and video surveillance, your insurance costs will be lower.  Choosing a gated community with undercover parking will continue to drop your insurance premiums. In terms of liability, regular maintenance and inspection of your building can reduce risks. Look for a condo with excellent maintenance teams; request an inspection, even on a new unit, to ensure everything has been built properly.

Location in Building Matters

Aside from the building you are in, where you are located in the building is important. Your cost will come down if your front door is on the inside of the building rather than on the external walls. Choosing a unit on the upper floors is usually more desirable. Thieves are more likely to strike on the lower floors. Further, if there is a flood or other problem in the building, the lower floors will tend to carry the brunt of the problem. Units on upper floors are not exposed to the problems of all of the units above them like those on lower floors. Be sure to inform your insurer if you are in a safe, desirable location in your building.

 

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