Condos & How to Insure Them

Description

Because the unit owner's coverage must dovetail seamlessly with the association's coverage, the same information is required for both parties regardless which person or entity is the agent's client. Every agent writing either a unit owner OR a condominium association must have: 

• A copy of the association's declarations and covenants, conditions and restrictions (CCRs);
• A copy of the applicable state statute;
• An official letter documenting the unit's boundaries and detailing who is responsible for insuring which property; and
• A verifiable or signed property valuation.

Having this information allows the agent to answer the three KEY questions when analyzing and placing coverage for either a unit owner OR a condominium association:

1. Who "owns" what property?
2. What value applies to the owned property? (And what should be used?)
3. Who is liable for bodily injury and/or property damage?

Not knowing, or just guessing, the answers to these three questions can leave gaping holes in coverage. The unit owner, the association, or both may be vastly underinsured.