Thinking about buying a condo? Condo’s are great for turnkey living and low maintenance however there are substantial differences when it comes to insurance.
Master Policy vs. Unit Owner’s Policy
There are 2 policies with any condo, the Master policy and the Unit Owner’s policy (HO-6). The Master policy provides coverage for the building and common areas. The Unit Owner’s policy (HO-6) provides coverage for everything inside the unit.
Master Policy
The condo association owns and insures the outside structure of the condo building. The condo master policy agreement (bylaws) stipulates what part of the structure is owned by the association and what part makes up the individual’s unit that the unit owner is responsible for insuring. For example, the bylaws may stipulate the unit owner is responsible for everything from the studs inward.
There is no standardization of master policy language so it’s vital to understand the specific agreement in order to know what the unit owner’s insurable interest is for the unit. Over the years condo associations have been moving toward policies that provide less coverage thus placing more of the responsibility on unit owners.
Condo Insurance (HO-6)
Unit owners need to obtain condo insurance, or better known as HO-6 insurance. HO-6 insurance provides coverage for your personal belongings, interior structure such as the floor, drywall, cabinets ect..Condo insurance also provides liability coverage which is very important with any condo. If damage results from for your unit and causes damage to other units, you are responsible.
Contact The Andrew Agency
Have questions about condo insurance? Contact The Andrew Agency at (804) 320-2886 or visit www.theandrewagency.com. The Andrew Agency is an independent insurance agency with access to several insurance companies and will help you find the right insurance solution.
