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What insurance do I need if I’m purchasing a condo?

When it comes to buying a condo, there are certain insurance coverages soon-to-be owners need to understand. It’s also important to know the difference between insurance for the condo association versus insurance for the condo owner. Here’s a look at both aspects as well insurance coverages which could help condo owners.

Understanding what’s covered

A condo association insures the building and common areas. It does not insure possessions in each unit or provide coverage if a condo owner damages another unit or if someone becomes injured in a unit and files a lawsuit against the owner. This is where condo insurance comes in – it can help condo owners handle the expenses from unexpected events (such as legal fees) if they occurred.

Insurance coverages to consider

Here are some insurance coverages which could help condo owners. A BrokerLink broker can explain additional coverages and also, find other coverages which suit the needs of the condo owner.

Unit additional protection

This coverage insures a condo owner’s individual unit against an insured peril (i.e. a fire). In the event the condo association’s insurance cannot provide sufficient coverage, unit additional coverage may be able to help cover costs.

Betterments and improvements

Betterments and improvements to a unit could involve new flooring. If there is damage to these improvements, betterments and improvement coverage could help with repair or replacement cost. Also, this coverage could help in the event there is a total loss of a home. The betterments could have increased the home’s value, which will impact the replacement cost. To ensure betterments and improvements are insured and, to accurately reflect any increases to the value of a condo unit, it’s important condo owners notify their broker about betterments and improvements they make.

Loss assessment coverage

Condo owners share common property, such as roofing. If there is a loss to shared property by an insured peril, loss assessment coverage could help if the condo association’s insurance is insufficient.

Additional living expenses

If a condo owner’s unit become inhabitable and they needed to relocate, additional living expenses could help cover living expenses, such as staying in a hotel. A BrokerLink broker can help condo owners understand what circumstances would be covered (i.e. fire and water damage), and other policy restrictions.

Personal liability

If someone was injured at a condo owner’s unit, the owner could be responsible for injuries. Personal liability insurance could help cover legal expenses if this occurred.

Other insurance coverages for condos

A BrokerLink broker can help condo owners learn about other optional coverages which could be beneficial. Two optional coverages include sewer backup and overland water coverage.
Whether or not a condo owner is eligible for the coverage will depend on where they live – a BrokerLink broker can help a condo owner determine if they’re eligible.

Sewer back-up coverage

If a property’s drainage system becomes overloaded by water, it could flood the condo unit. This is problematic as the water could contain sewage and debris. If this occurred, sewer back-up coverage could help cover repairs.

Overland water damage coverage

If water suddenly entered a condo unit home from a severe weather events, such as heavy rain, overland water damage coverage could help with expenses to fix resulting damage.

Get informed

The best way to understand condo insurance is to contact a BrokerLink broker. Our brokers understand how condo insurance works and the coverages which will best suit condo owners. Should condo owners already have insurance, BrokerLink brokers can evaluate current coverage and make suggestions for enhancements.