Insurance Advisor at Oliver L.E. Soden Agency, Inc

Understanding Condo Unit Owner's Insurance

For some people, condominium living offers the best of both worlds: an affordable property that you own but less yard work, shoveling and major repairs. But there is one area that deserves just as much attention as a single-family dwelling, if not more: your insurance coverage.


The coverage amount that you select should insure the building property that is your responsibility under the bylaws of your condo association. So before you settle on a policy, make sure you understand the coverage your association has. This way, you can bridge any gaps between your unit owner’s coverage and your association's coverage.


The Master Policy


Insurance for a condo association is often referred to as a master policy. What your master policy covers isn’t always clear, unfortunately. To help you understand what the master policy covers, read through the condo association documents, specifically, the declaration. There you will find exactly what is covered and what the unit owner is responsible for. Then you can talk to your insurance agent about what unit owner policy is right for you.


All master policies are different. Some insure only the common areas and your unit’s structural parts. Others insure everything listed before plus your unit’s drywall and mechanicals. Other policies will go as far as to insure the wall and floor finishes, though this isn’t typical. In most cases, unit owners are responsible for everything beyond the bare walls and floors.


The Unit Owner Policy


The purpose of your unit owner’s policy is to cover the building property that is your responsibility according to your condo bylaws. Usually this includes drywall, mechanical, improvements and alterations, finishes and appliances. It will also cover the personal property in your unit. It typically does not cover the land.


Homeowners insurance is mandatory if you have a mortgage to pay off. If this is the case, you will need insurance just for your unit. Start by reading through the bylaws and talking to association board members to know what is covered under the master policy. Then talk to your insurance agent about which policy is right for you.