February 8th, 2016
To own property, in any form, is a triumph. It means you have excelled in what many continue to work tirelessly for, financial security. What was it that Scranton’s own Michael Scott once said? “It is very important to own property. Back in olden days, they would not even let you vote unless you owned property and they’d throw you in the stocks and humiliate you.”
While this isn’t exactly true, being a real estate owner does have a certain appeal: it’s yours. Once you find the condominium you call home, sweet home – investing in condo homeowners insurance is vital to maintaining your happiness and well-being. Why? Because if something happens, as something always does, you’re covered.
What’s the Big Deal with Condo Homeowner’s Insurance?
Once you sign your name on the dotted line, you become the proud owner of your first home. A condo can be described as being born the love child between a house and an apartment. A condominium provides you with space and allows you to grow, just like a house – all while supporting your social needs with close neighbors and community areas, just like an apartment. But like a house, you need homeowner's insurance to protect you when tragedy strikes. When you take out a mortgage, be it for a house or condominium, your bank lender will require that you also take insurance out on your property. Your bank sets this as a prerequisite to getting a home loan in order to protect their assets should something catastrophic happen to your property, such as fire or flood damage.
Now keep in mind that homeowner’s insurance and condo homeowner’s insurance are not one and the same. There is a reason that a distinction between the two has been drawn. As a condominium owner, remember that your Condominium Association regulates the rules of your complex, so before signing up for an insurance plan, check to see what exactly your association covers. The Condominium Association, similar to a Homeowner’s Association, collects fees on a monthly basis from unit owners and uses a percentage of the capital to insure common areas, this includes sidewalks, pools, parking structures and landscaping. The unit owner on the other hand is responsible for insuring everything within his or her condominium unit. For the condominium owner, this includes furniture, electronics and other personal effects.
According to the Insurance Information Institute (III), as a condominium owner, you are going to need two separate insurance policies to protect your real estate investment. This includes your own insurance policy, and a “master policy” provided by your Condominium Association. One key thing to remember in all of this is that a condominium owner is personally responsible for built-in appliances, wiring, plumbing, fixtures and even the kitchen cabinets. When you are ready to take out a condo homeowners insurance policy, here are some things the III recommends you reference:
- Unit Assessment: This guarantees that you are compensated for your share of an estimate charged to all condominium owners in the condo complex.
- Umbrella Liability: With this coverage you save money and get more liability protection and extensive coverage than is provided by a standard condominium policy.
- Water Back-up: This protects your property from damage done by sewage backup and drains.
- Flood or Earthquake: Flood and earthquake insurance policies are purchased separately. If you live in a geographical zone prone to natural disasters, you need to include these in your condo homeowners insurance package.
- Endorsement or Floater: If you own expensive collectibles, jewelry, or furs – you probably want to get additional coverage in the case of a burglary or natural disaster.
Finding the condo homeowners insurance policy that meets your expectations is as necessary as feeling comfortable in your own home. Find your perfect condo homeowners policy with CoverHound today!