The Importance of Condo Insurance
A condo is a major investment. That is why it makes sense to buy condo insurance to protect your private space. After making such a huge investment, you should want the financial security offered by insurance. You might not own a house, but fires, floods and other issues can and do impact condo owners. Even if you think this insurance is unnecessary, a mortgage lender might make it a requirement. They’re thinking of their best interest, and you have insurance is how they can protect their investment.
Condos are a bit different from other types of homes. When you own a condo, you do not own the entire building. Instead, you own the inside of your living area. Anything beyond the front door does not belong to you. The condo association typically owns the exterior of the building. That means you need condo insurance to help if anything happens to your space.
There are different types of coverage, but they all give you the ability to pay for repairs and renovations to your area. A policy should also pay to replace personal content, such as furniture and electronics. Some condo insurance policies also pay for a hotel or other living option while your condo is being repaired. You also might want to make sure the policy you get includes a liability component. There is always a possibility of someone else getting injured on your property. Liability coverage can pay for legal expenses, medical bills and more that you may be faced with.
Just like with other insurance, you will have to file a claim and pay a deductible. The deductible may be as high as one to two percent of the property value. It is a good idea to keep the amount of your deductible in a savings account for emergencies.