Understanding the Condominium Insurance Requirements for Residential Condo Buyers and Owners

 

Condominium purchasers do not have to purchase standard hazard or flood insurance, even if the condominium is in a designated flood zone.

Hazard insurance is still required. But the condominium association is normally responsible for hazard insurance coverage on the structure and other improvements.  The individual condominium unit owners pay for this insurance coverage through their monthly homeowners association dues.

This is another reason why it’s important for condominium or homeowners associations are empowered to collect association fees. In worst cases, condo associations can actually foreclose on condominium owners who are delinquent on their association dues… or force them to sell their unit.

Personal Condominium Owner’s Insurance

Even though you don’t need standard hazard insurance coverage for your condominium unit, it’s still a good idea to obtain a condominium unit owner’s insurance policy.

Standard condominium insurance protection does not cover the contents of the individual units.  Condominium insurance only covers damage to the structure.  A unit owner’s insurance policy, much like an apartment renter’s insurance policy, covers the contents of the unit.

For example, if condominium owners directly above you leave their windows open during a big rain storm and cause a flood that damages your ceiling and walls, the condominium’s insurance will normally cover the cost of repairing the ceiling and walls.  However, if that flood damaged your furniture or other possessions, you will be out of luck.

Thus, condominium owners should purchase additional condominium owner’s insurance to insure their possessions against burglary and destruction.  This is similar to apartment renter’s insurance and can be obtained through most homeowner insurance agents.