When buying a condominium one of the biggest selling attractions is little or no exterior building maintenance or repairs need to be made by you. These are usually covered in the condominium associations "Master Condominium" policy, however each unit's interior is the responsibility of the homeowner. Nearly all condo associations require specific condo insurance.
Who is responsible for what?
In most condo communities the association is responsible only for the the structure and common ground. From the studs in is usually the homeowners responsibility and can include plumbing, drywall, cabinets, flooring, etc.
In the event of loss or damage of any of your private property within the condo, you are responsible for it. Our recommendation is to calculate all your personal belongings inside your unit for replacement cost, which is the cost to replace the item, not its depreciated value. This would be everything from your socks to your flat panel TV and everything in between.
What will my policy include?
Dwelling Protection and Personal Property Protection (see proceeding paragraph).
Family Liability Protection. This particular coverage will help provide legal representation and insurance against judgments.
Guest Medical Protection. Receive reimbursement for temporary housing during reconstruction.
Loss Assessment. If your association requires an assessment onto all unit owners for a certain covered loss, this policy would pay for your share, up to your policy limits.
New condo insurance law explained
The Florida legislature passed House Bill 601 recently and it applies to all policies issued or renewed after January 1, 2009. Take note if you currently do not have condo insurance! Your condo association will have the full ability to "force place" insurance if you do not seek out and obtain your own.
Increased Loss Assessment: The new law passing requires that your condo policy provide a special loss assessment coverage of at least $2,000.
Condominium Association Treated as Named Insured / Loss Payee: In accordance with the new law passed, your condo association will be treated as a named insured and loss payee for covered reconstruction costs related to any condo property that the unit owner is required (by law) to insure. This new change does not affect or increase your policy's coverage. It means, in simple terms that the condominium association will be named on any loss payments made under building property protection of your policy in addition to you. Your condo association does not have the right to cancel your policy and are only listed as Interested Party to coordinate coverage in the event of a loss in which both you and the association are responsible.
Providing Evidence of Hazard and Liability Coverage: In accordance with the new law all condo unit owners must also provide proof of hazard and liability insurance to the association. This proof needs to be provided once per year and your Policy Declarations along with this letter should be adequate proof of your coverage and compliance with the new law.
We understand that some of this can get confusing, and new laws are always being passed while older ones are being updated. If you have questions or need help please contact our offices and we'd be happy to schedule an appointment and review your current policy.
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