Condo Owners and Renters Insurance Are Not the Same. Here’s What You Need, and What You Don’t.

Renters and condominium owners face the same risks as all homeowners. Anyone’s belongings can be lost to fire or theft, and anyone can be sued for causing injury or property damage to someone else or their property. Your landlord and your condo owners association have insurance, but they will not cover your belongings inside of your apartment or condo unit. You need to provide for your own protection against these risks, or you could face serious financial consequences.

Renters Insurance

Renters insurance covers your possessions for losses related to fire, smoke, lightning, vandalism, theft, explosion and windstorm and water damage (not floods!). Renters insurance also provides liability coverage that protects your assets when you, a family member or a pet injures someone at your home or somewhere else. This liability coverage will pay for your legal defense as well as any damages you must pay if someone sues you.

Most renters insurance policies will also cover additional living expenses if you cannot live in your apartment because of a fire or some other covered loss. Additional living expenses coverage can include reimbursement for hotel bills, temporary rentals, restaurant meals and certain other expenses you incur while your unit is being repaired or rebuilt.

A basic renters insurance policy only provides a limited amount of coverage for valuables like jewelry, computers, electronics and so on. If you have some high-value items that need additional coverage, you can add a scheduled personal property rider or endorsement to your policy. A personal property rider provides appropriate coverage for items whose value exceeds the limit that the basic policy specifies, and it might also cover the specified items for additional causes of loss that are not covered under the basic policy (e.g., accidental loss of a piece of jewelry might be covered if the jewelry is listed under a scheduled personal property rider).

The average renters insurance policy costs between $15 and $30 per month. Replacing all of your possessions or being held liable for an accident will definitely cost you far more. And discounts are available for renters with security systems, smoke detectors, deadbolt locks, good credit, multiple policies with the same carrier and more.

Condominium Insurance

Condominium insurance is different from renters insurance and different from regular homeowners insurance. Condo owners have unique insurance needs; typically they need to insure only a portion of the building in which they live and their personal property, while the condominium owners association provides coverage for the rest.

Every condo owners association functions by a set of rules, or by-laws. These by-laws may differ from complex to complex, but typically the condo association insures the building(s) and the common elements of a complex under a single package policy called an association master policy. This association master policy provides coverage for common areas of the complex, while condo unit owners are responsible for insuring everything within the four walls of their individual units.

Most association master policies will fall into one of the three following categories. You must know what type of coverage your association master policy provides in order to purchase the right insurance for your unit.

• Bare walls coverage insures the basic elements of a building’s structure (walls, roof, floors, elevators), but requires the unit owners to obtain coverage for interior elements like countertops, bathroom and kitchen fixtures, flooring, appliances, carpet, cabinets, wall covering and other items within individual units. Owners might also need to purchase coverage for the interior walls of their units.
• Single entity coverage insures the basic structure and certain items within individual units other than the owners’ personal property. Items not covered include improvements made at an owner’s expense, and builder-installed items like countertops, fixtures, carpeting and so on.
• Modified single entity/all-in coverage protects fixtures, installations, or additions/improvements within the interior surfaces of the perimeter walls, floors and ceilings of individual units. Unit owners have a more limited need for coverage under these types of association master policies.

There can be many variations within these basic types of association master policies. You need to know what you own when you buy the unit, and then we can help you determine how much coverage you need for your personal property and for any structural elements that you need to purchase coverage for. There are often gaps between the association master policy and a condo owners policy, but we can eliminate those gaps if we have your association policy and by-laws in hand when we discuss your coverage needs.

Are you a renter or condo owner who is unsure of the type of insurance coverage you need? Do you need help determining how much personal property coverage you should buy, and if you need to add any special riders or endorsements for your valuables? We can work closely with you to determine the types of risks you face as a renter or condo owner. We can help you find the best policy for your needs, and make sure you receive any discounts you are eligible for. Contact us today to learn more about protecting your belongings with renters insurance and condominium insurance.