The HO-6 form is the standard condo insurance policy issued by most insurance carriers. It is designed for the individual unit condo owner. The Master Condo policy is designed for the Condo Association. The Master policy covers the building, the common areas, and the condo association’s liability.
The first thing you need to know as a unit owner is – what do I own? You may own from the “last coat of paint” in or you may own from the “studs” in. So, you may literally own the walls, floors, ceilings, carpets etc. Once you determine what you’re responsible for in a loss, you can begin to place the proper coverage on your own individual condo policy.
Part A (Dwelling) of your condo policy covers that part of the building that you own and are responsible for in a loss. Again, the walls, floors and ceilings but could also include other property like cabinets, stove, dishwasher or any additions, alterations or improvements that you may have made to your unit. Part C (Personal Property) covers your contents which include your clothes, furniture and other personal belongings. Part D (Loss of Use) protects you if you’ve lost the use of your unit; say for example, a fire loss. This section would pay you for any additional living expenses you may incur as a result of you losing the use of your condo. Part E (Personal Liability) protects you against claims for bodily injury and property damage that you may be legally responsible for. And, Part F (Medical Payments) covers you for small claims regardless of any negligence on your part.
Once you have determined the limits for these coverage parts, you should consider adding other endorsements to help protect your condo. You can add “special coverage” on Part A which would broaden the coverage for this section and insure you against additional perils. You should add “replacement cost coverage” on your personal property. This would allow you to replace your damaged property without depreciation. You should also add “loss assessment coverage”. Sometimes the Association doesn’t have enough coverage to pay for one of their covered losses and they must “assess” that loss to each unit owner. Depending on the circumstances, this coverage part could help pay for your individual assessment. And, you might need to purchase special coverage for jewelry, furs or other valuable items.
And, don’t forget to ask about discounts. You may be able to place your condo and car with the same carrier and receive a discount on one or both policies. There are other discounts available including smoke or burglar alarms, non-smoker discount, customer loyalty credits, loss free credits and discounts for carrying higher deductibles.
It’s always best to consult with an insurance professional to review your particular needs and purchase the best coverage for you. An individual unit owner’s policy is relatively inexpensive but if the proper limits and coverage options are chosen, you will have excellent coverage in place to protect you against loss.
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