Condo Insurance 101

Insurance is often a very misunderstood product and this is even more often the case when it comes to condominium insurance. Some people think that the condominium corporation carries insurance so there is no need for the unit holder to carry any, or they carry only enough insurance for their contents. Your own policy can help with your unit improvements, some assessments, and liability. Make sure you have enough coverage for these things.

Under a normal condominium corporation policy, improvements to your unit are not covered. What this means is that if the unit was built with carpet and lino, and laminent counter tops, but you have done renovations and now have hardwood, ceramic tile, and marble counter tops, the condo corporations policy will only pay for the original construction and your insurance will step in for the improvements. This is not normally an issue at claim time because the insurance companies communicate and figure out who pays what behind the scenes. However, if you don’t have adequate insurance to cover your improvements this could end up costing you out of your own pocket.

The most common problem is seen when it comes to basements. Basements were not originally finished in your unit – so if you finished your basement it could be your insurance company’s responsibility to repair in the event of a loss.

Not only does your policy come into play with improvements, it also covers things that your by-laws state are your responsibility such as windows and doors, assessments for the condo corps insurance deductible, short falls in condo corp insurance, and liability for damage to other units as a result of your negligence, etc.

The bottom line is that your condo corporation carries insurance and its policy coupled with your own unit insurance is your best protection. If you don’t have insurance you have left your self exposed to a loss that could cost you dearly. Condo insurance is the least expensive type of home insurance, so it is well worth your time and money to get it. The best advice is to contact your insurance provider to discuss your policy.
Roger Stevenson