Condominium & Townhomeowners Association Insurance
Minnesota Condominium & Townhomeowners Association Insurance
If you live in a condominium or townhome owners association, you likely have access to several shared amenities such as parking, sidewalks, sitting areas, maybe even a pool. It’s an appealing set up for anyone who values these things but doesn’t want to put in the work to maintain them. Of course, like any public property, these areas still need to be insured. The condo or townhome association that handles their maintenance will also have its own insurance policy.
How does the association insurance policy work? And what does it cover? We’ll cover all that, plus how condo association insurance differs from an HOA master insurance policy.
What is a condo/townhome association insurance policy?
The money you pay to your condo/townhome association helps pay for all the amenities members of your community share. It also pays for the insurance policy that covers those amenities. This is your condo/townhome association insurance policy, also sometimes referred to as a master condo policy, HOA master insurance policy, or otherwise simply as HOA condo/townhome insurance. This policy covers damages to areas that are shared in your building or complex such as lobbies, elevators, amenities like swimming pools or tennis courts, and even the exterior of the building itself. It also protects the association against liability costs if someone is injured on the premises.
How is condo/townhome association insurance different from individual condo/townhome insurance?
Condominium and townhome association insurance is not the same thing as general condo/townhome insurance, which individual members of the association complex can purchase for themselves. Individual condo and townhome insurance protects the interior of the home and belongings within it and pays liability costs if a guest is injured. Think about it like this: the association insurance policy covers everything outside of the walls of your unit, and your individual condo insurance policy pays for everything inside them. It is important to note that the scope of the condo or townhome association insurance policy begins directly behind that wall. Studs, drywall, and insulation are all included.
What is included in condo and townhome association insurance coverage?
Your association’s insurance policy covers all the public areas and shared amenities within your building or complex. This includes parking lots, lobbies, elevators, tennis courts, and any other spaces or features your community shares. Some condo association insurance policies go a step or two further, however. A “bare walls” policy stops at your drywall, studs, and insulation, but policies with “single-entity” or “all-in” coverage may cover your cabinets, flooring, and even any built-in appliances.
If someone slips, falls, is injured in your building’s lobby, and decides to sue, who’s liable for the ensuing legal expenses? Your condo association’s master policy likely includes liability protection for just such an incident.
Since individual residents are only responsible for the insides of their units, it falls to the association to protect the rest of the building, including the exterior. If a storm or other natural disaster damages the roof or siding, the condo / townhome association’s insurance policy will likely cover the cost of repairs.
Common areas such as lobbies, elevators, hallways, and land outside the building are all typically protected by an association’s insurance policy. Shared amenities such as swimming pools and tennis courts are also likely included in that coverage.
The importance of condo and townhome insurance
No matter how extensive your condo/townhome association’s insurance policy is it will never cover everything. Residents should always have your own insurance coverage. Your policy will protect your personal belongings it also provides you liability coverage in the event someone is injured inside your unit and loss of assessment coverage for paying damages like high deductibles that exceed your association’s policy.
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