Shopping for the lowest Condo or Renters Insurance can be challenging regardless, of what part of California you reside in. We have clients living in Riverside CA to Los Angeles, all facing the same deli-ma, “where to buy quality condominium coverage” and how to save with your current condo insurance policy.
Let’s dive right into what this coverage offers, starting with the varied types of policy forms you may encounter before you begin your online insurance quote.
Understand Condominium Insurance
Condominium coverage actually is categorized under your standard Homeowners policy umbrella.
This umbrella is divided into six variables or insurance types with condominium insurance, being labeled as an HO-6.
Condo Insurance — HO-6
Many differences lie within owning a home compared to a condo. For starters, the lack of backyard, basement, or garaging area are a few differences to owning a condo versus a home, but these differences may just be what the condo owner is looking for as opposed to a homeowner.
Some people spend their lives traveling and really do not have the need for landscape and rather have an association handle the maintenance of mowing the lawn and other duties normally tended by a homeowner.
Here’s another way that a homeowner’s policy varies from a Condo policy. People who own their unit will need coverage to cover just their property section.
It is the responsibility of your condo complex to carry coverage for the complex, similar to that of a renters insurance policy.
On the other end, this is where your landlord would require you to carry the liability portion of the coverage.
Every condominium complex has different regulations and rules. This is why it is important you obtain a copy of the documents you sign and review.
Regulations and Rules
Make sure to find all regulations and rules of your homeowner’s association, since parking regulations seem to be a huge issue with most condo residents.
Actually, parking in some parts of California can be a mission alone.
For example, some condo complexes may not have overnight parking for any visitors, where other complexes may provide an overnight pass for visitor parking.
Knowing these regulations can save you not only potential towing fees, but also any unnecessary headaches unforeseen at the time you purchased your condo.
In addition, it is important to go over what coverage’s your association will require you to carry, and what name they want listed on your policy.
If you are financing your condo, check with the loan provider with what coverage’s if any are required, since they also have a financial interest in your condominium property.
1. What’s a Master Copy?
Condo Owners obviously do not own the entire building complex, and have shared privileges with other condo owners in the complex.
These privileges are based on the following regulations and rules of the HOA or Homeowner’s Owners Association.
If a shared privilege was using the common ground pools, but the rules stipulate no swimming after 11 PM, than you better make sure that the rule is followed or it can potentially revoke privileges based on the HOA guidelines.
Keep in mind each condo complex has different rules and regulations regarding these special privileges so make sure to read up on them before purchasing your condo unit.
If you live in a condo, you probably have already experienced your condominium association, either through bulletins, at the time of your purchase or through association fees.
Association fees are the cost of the collective group of owners to maintain the common grounds of the complex.
Basically, like a pie pan, everyone living in the complex pays their portion to maintain and utilize the common grounds.
This shared responsibility helps to reduce individual expense to the individual unit owner.
As an individual unit owner, you are more than likely responsible for insuring everything between your four walls.
Anything outside this realm is covered by the unit complex.
The master copy of your unit complex will detail the rules and what areas of the complex are the responsibility of the complex and that of the unit owner.
The Master Copy is like the blueprint. It maps what is expected and required of you as a condo owner, which is why it is so important to review these guidelines prior to shopping for unit coverage.
2. Cost of an Association Deductible?
Commercial coverage is the coverage most commonly found for the common areas of the complex as well as the shared building. These type of policies normally have a deductible for the association.
This Association Deductible can be found in the Master Copy provided at the time of sale. Review the bylaws and guidelines spelled out in the master copy.
It is your playbook to protect one of your largest investments.
3. How much Coverage to Carry
After figuring out what parts of your condo need to be protected and individually insured, your next question is “how much coverage should I carry”.
Normally your master copy will spell out coverage amount so, make sure you review and understand this portion in your master copy.
If no coverage amount is listed or required by your unit complex, than you can carry the minimum liability coverage with property coverage for your possessions.
Not every policy is the same however, and not all Coverage companies offer the same protection.
Make sure to understand the underwriting guidelines on your unit policy, since gaps of coverage could exist, costing you more than expected.
4. What’s Better – Replacement Cost or Cash Value
After reviewing what coverage’s you would like on your unit, the next question is whether you want Replacement Cost or Cash Value. You are probably asking what’s the difference?
Great question because it can mean the difference in thousands of dollars. If you choose the actual cost value path, than the depreciation will be based on the content’s age.
Let’s use your television as an example in this case. If your television has several years on its age, than the current market cost would be determined by subtracting the depreciation of the item based on its age.
So in the event of a claim, your insurance company would cut a check in the amount of your TV’s worth at the time of sale, minus for wear and tear and there you have it, the process of actual cash value.
However, if you choose replacement cost instead, you would receive a check from your insurance company to replace the older model television with a new model upgrade.
Make sure you understand the difference in coverage so that cheap condo insurance doesn’t cost you huge down the road.
5. Coverage Contents and Structure
A great coverage to have consider adding on is, contents and structural items coverage.
If you own a unit, than you may have slightly different needs and perspective compared to a person who owns a single family home.
Usually, if you are a single family home owner, you are looking to protect the replacement of the exterior structure in the event of a claim.
This factor is primary to that of contents and the interior structure of the home itself.
However, it is complete opposite for that of an unit owner. Your first line of defense in protecting your assets and investment is to look directly inside your home.
All your possessions, such as your Television, computers, jewelry and so forth.
Obviously, each policy has different limits of coverage but the end result are typically the same which is that of piece of mind.
We suggest our insured’s to always keep their prized possessions such as photos and memorabilia in a safe to guard against any outside elements that could forever damage your memories.
For everything that can be replaced with your contents insurance, rest assured it is protected.
All you have to do is just pick your limits and how you want your possessions to be valued.
6. Flood and Wind Damage Coverage
Flood protection is an optional coverage offered by the U.S. government to protect your home in the event of a flood.
Even thought this coverage is an optional coverage, if you are financing your home, your mortgage holder may request that you carry this protection.
In this case, Flood Insurance is mandatory. If you have any doubts to whether you need flood coverage, you can always check the flood zone areas in your territory or contact a flood coverage specialist.
They can provide you with the tool that can help you be proactive in your decision of buying flood protection, and if you do indeed live in a high risk zone for floods.
We know comparing coverage for your unit in California can be challenging, especially if this is your first purchase or have coverage questions.
We see unit owners from Riverside CA to Los Angeles CA having the same insurance questions and concerns.
No matter where you live in California, let us help you in your search of low cost insurance quotes auto and condo. We understand your market and have specialists waiting to answer any questions you may have.
Give us a call at 800-962-0085, we have been helping Californians save on Property and Auto Insurance for over 30 years!
Service Areas: Riverside, Corona, Temecula, Hemet, Big Bear, Highland, Colton, Grand Terrance, San Diego, Murrieta, Lake Elsinore, Chino, Anaheim, Chino Hills, Yorba Linda, Anaheim Hills, Orange.
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