Condo insurance is a type of homeowner's coverage for those that currently own a condo. Whether you are living in your condo or using it as an investment property, you will need to insure it in the event of a natural disaster, emergency or unforeseen damage to the unit. Condo insurance policies includes coverage on your HOA master policy as well as your own individual policy. It is important to understand both sides of condominium insurance to ensure you are adequately and accurately protected.

Condo Association Insurance

When you purchase a condo you will automatically become a part of the complex association where the condo is located. This association is referred to as a homeowners association (HOA) or a condo association and is put in place to protect the homeowners in the complex. One of the things that the HOA will regulate is insurance.

Most condo association master insurance policies will include liability coverage as well as structural protection to the complex as a whole. This includes damage and injuries sustained in the parking lot, the swimming pool, the gym and other common grounds. If someone is injured or killed on the premises, then liability coverage will kick in. For example, if a tenant drowns in the swimming pool or is hit in the parking lot, the HOA master policy will cover these losses. Because you are now part of the HOA, you will need to pay a premium each year to go towards this protection.

Some master policies will also protect against structural damage to your individual unit, such as the flooring, the walls and the roof as well as your individual garden or landscaping but many will not. Check to see if your condo association master policy is a 'bare wall' of 'all-in' policy which will determine what is covered. As a condo owner it is your responsibility to not only pay the premium for your condo master policy but also find out what exactly is insured under this plan.

Individual Condo Owner Insurance

Once you know what is covered and what is not you should do your own research and look for additional coverage through an individual condo insurance policy. Condominium insurance is one of the seven categories for homeowners insurance. General policies include liability coverage for your individual unit, structural coverage for your individual unit and contents protection for your belongings. You can choose to add on extras such as landscaping coverage (often referred to as debris or clean up insurance), flood and earthquake coverage and anything else you find necessary for full protection for your home.

Many condo owners will opt to use their unit as an investment property. Condos make excellent rental units as they are maintenance free but offer plenty of space for students, families and roommates. If you are renting out your condo you may not need contents insurance (if the place is unfurnished) but you might want to look into landlord specific options for your condo such as rental protection and tenant insurance. These options will offer compensation if your tenant trashes your unit, doesn't pay the rent or if he breaks the lease, all of which are common concerns for landlords.

Get an accurate understanding of your condo master policy before looking for individual condo insurance. You want to be sure that your condo is completely protected from all disasters, emergencies and damage incurred. Regardless of whether you are living in your condo or renting it out, proper care and adequate insurance are necessary for a safe and happy home.

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