Condo/Co-Op Insurance FAQs
My condo association or Co-op’s master policy covers everything in my unit, right?
While you may have some coverage through a master policy for your unit, it’s generally not going to cover your full unit, or the additions you add and alterations you make inside of the unit. Additionally, your association’s policy is almost definitely not going to cover your personal liability exposure in your unit or worldwide
So, how much insurance do I need for my condo or co-op?
If you have a mortgage on your unit, the mortgage company will typically require a minimum amount of coverage that you will need to purchase, but it's important to know that the limit they require is often less than the amount that YOU need
In order to calculate the amount of insurance you need for your unit during the price quoting phase, we will use our knowledge and available replacement cost calculation tools that carriers have available to come up with an estimate of your home's replacement value (aka it's estimated cost to rebuild)
After the quoting phase, if you decide to purchase a policy, the carrier we place you with will often want to inspect the home (typically free of charge). That will determine how much coverage the house itself needs, as well as whether or not additional loss prevention features are needed in the home, such as a monitored fire alarm system.
You’ll also need liability coverage to protect yourself from lawsuits, we use different methods to calculate an adequate liability limit for you, per the below.
How does replacement value differ from purchase price or market value?
Replacement value or replacement cost takes into account the uniqueness of your home, the difficulty in finding the parts to rebuild it with materials of the same quality, the risk of a catastrophic event in your area increasing prices to repair or rebuild your condo building, and much more. For example, a condo that sells for $1,000,000 in a hot market may only cost $750,000 to rebuild, or alternately due to it's age, unique features, and location it may cost well over $1,000,000. Purchase price has many factors that are taken into account, such as location, public transit capabilities, the public school system's reputation and much more. Many of these same factors will have little or no impact on the cost to rebuild the house
Is the replacement cost that ends up showing on my policy the maximum I would get paid out if my condo or co-op was lost in a fire or another covered claim scenario?
Thankfully the answer to that question is typically no, because the carriers we work with generally either offer an "extended replacement cost" coverage
These two coverages will kick in during a rebuild if the inspected or estimated replacement cost turns out to be below the cost to rebuild. Guaranteed rebuild coverage will make sure that your home is rebuilt in a way that is as close as physically possible to how the house was before it was destroyed, regardless of the cost. Extended replacement cost will typically afford an additional 25%-100% of coverage in case the limit on your policy is exceeded when rebuilding a destroyed home after a covered loss
Great, so you'll calculate my unit's value, but what about my belongings I have there or in storage?
When it comes to deciding on the amount of coverage needed for your belongings that you have at your unit or in storage, a limit is usually calculated as a percentage of the condo’s replacement value. The limit that is adequate for you can vary widely depending on how many people you have living in the home and if you have a lot of belongings, or prefer not to own more than what is totally necessary
Items in storage worldwide that are away from a residence will be covered under the limit we estimate, so we’ll need to consider your storage use, if any, to avoid your having inadequate coverage
It's also important to note, as we discuss within our Collection FAQ page, there are limits to how much coverage most carriers will afford for collectible items such as jewelry, coins, furs and more in the event of theft or disappearance (e.g. losing a watch on vacation). We can properly cover these items via an endorsement (a coverage addition to your condo/co-op policy) or via a separate policy, but just know that when we talk about coverage for your belongings on a condo/co-op policy, we’re typically referring to non-collectible items
What does a typical condo/co-op policy cover?
While there are certain exclusions for specific claims scenarios, as well as plenty of additional coverages that can be added or may be included by default, at a minimum modern condo policies typically include coverage for damage due to the following events (aka perils):
Fire or Lightning
Volcanic Eruption (coverage varies among carriers)
Windstorm or Hail
Riot or Civil Commotion
Damage caused by Aircraft
Vandalism or Malicious Mischief
Damage due to weight of Ice, Snow, or Sleet
Sudden & Accidental Tearing Apart, Cracking, Burning, or Bulging
Sudden & Accidental Damage from Artificially Generated Electric Current
Accidental Discharge or Overflow of Water from Plumbing, Air conditioning etc.
Condo/Co-op policies can also typically include liability coverage as well, and you can learn more about that within our Liability Coverage FAQ page
Also, if a covered loss requires you or your renters to move out of your unit temporarily, or for an extended period, Loss of Use (LOU) aka Additional Living Expenses (ALE) or Loss of Rents (LOR) coverage will kick in to cover the bills required to maintain your living standards or make up for lost rental income while the repairs take place*
How much liability coverage should I buy?
You should be buying enough liability coverage to adequately protect your net worth from a lawsuit
If you have just started your career and are beginning to build your wealth, a limit of $300,000 may well be adequate. If you've purchased an upscale condo for your family, you may need well over $1,000,000 or more in liability coverage to be properly protected
We can't know the correct answer to this question without knowing what you own, so once we speak to you or you request a quote (links below) we'll be able to determine an adequate limit quite quickly
What do you need to get me price quotes for insuring my condo?
We really only need a small amount of information about you and your condo/co-op in order to obtain quotes from one (or more than one) of our carriers. For the quickest turnaround time you can fill out our quick 2-5 minute online quote request form (links directly below)
Alternatively, we can set up a time to talk in person (location dependent) or have you provide us with your information over the phone (212-495-9172 is our main number) or you can email us at Hayden@NorthImprovement.com. Whatever route you prefer to go is fine with us
*Loss of Use/Additional Living Expenses coverage varies between carriers and states. There is sometimes a negotiation involved in deciding where you will live while covered damages are repaired.
GET FREE QUOTES:
Want to see if we're the best advisor for you? In just 2 - 5 minutes you will be able to provide us enough information to apply for insurance on your behalf and obtain quotes from most carriers that we work with.
Select what type(s) of coverage you need below to get started: