What is Condo Insurance?

Condominium owners in New York own their condos and, therefore, are usually responsible for insuring them. Their insurance needs, however, are different from those of homeowners. Condo insurance policies are designed to meet the particular insurance needs of condo owners.

Condominium insurance policies are like homeowners insurance policies that are written with the unique insurance needs of condominium owners in mind. Like homeowners policies, condo policies typically provide structural coverage for a condo’s structure, personal property, and liability. The structural coverage they offer, however, is usually different from that provided by homeowners policies because condo owners don’t own freestanding houses.

Who in New York Needs Condominium Insurance?

In general, any New York residents who own a condominium in the state should have condominium insurance. Most condo owners who have loans against their condos are required by the terms of their loans to carry a condo policy, but even those who aren’t under an obligation to have a policy usually decide to get one. After all, condos in New York are often highly valuable, and few residents could afford to replace their condo and its contents themselves. Instead, they rely on an insurance policy to protect them against covered incidents

What Protections Do Condo Insurance Policies Provide for Condos’ Structures?

The protections that condo insurance policies provide for condos’ structures vary. Some policies don’t include much protection for a condo’s structure, while other policies afford a lot of coverage for cabinets, appliances, plumbing, wiring, flooring, and similar items.

How much structural protection a condo owner should look for in a policy will depend on what their condo association’s Offering Plan and By-Laws state, the master policy should follow those coverage guidelines and the Unit Owners policy will also be dictated by those terms. Usually there are three different insurance agreements, again the offering plan and by-laws will determine which:

  • “Bare Walls-in” master policies usually only cover a condo unit’s walls, and, sometimes, it’s electric and plumbing systems
  • “Single Entity” master policies typically cover a condo’s walls, electric and plumbing systems, and standard build-outs (e.g. un-upgraded cabinets and flooring)
  • “All-in” master policies often cover a condo’s walls, electric and plumbing systems, standard build-outs and upgraded features (e.g. upgraded granite countertops)

Whatever isn’t covered by a condo association’s master policy ought to be insured with a condo policy. Thus, a condo owner normally needs to purchase much less coverage if their condo association has an all-in master policy than if the association maintains a bare walls-in master policy

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Does Condo Insurance Include Flood Coverage?

As is the case with most homeowners policies, condo policies generally don’t include coverage for flood damage. Some policies provide some form of protection against leaks and plumbing backups as an optional protection, but their protections don’t typically include floods. Condo owners who are interested in flood coverage should talk with an insurance agent about buying a separate flood policy.

How Can Condo Owners Get Condominium Insurance?

Since the coverages that a particular condo owner needs are dependent upon their condo association’s master policy, owners who need condo insurance should work closely with an independent insurance agent. An independent agent can review an association’s master policy to see what coverages a condo owner should have, and then they can request quotes for policies that contain those coverages from different insurers that serve New York. From these quotes, a condo owner should be able to find a policy that’s good for them.

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