Understanding the Major Differences Between Homeowners and Condo Insurance
Learn how home and condo insurance differ.
Stand-alone homes and condominiums have major differences. This is why it should not come as a surprise that homeowners and condo insurance also have considerable differences. But what exactly distinguishes these two forms of coverage? Here’s how home and condo insurance differ.
- Understanding the Differences Between Homes and Condominiums
First, it’s important to understand what separates home ownership from owning a condo. When you own a home, you are responsible for everything inside the home, the home’s external structure, and the property on which the home is located. In contrast, when you own a condo, you are usually only responsible for the interior of the unit. The actual structure of the building, the surrounding property, and the complex’s common areas are owned and insured by your condominium association. This split responsibility creates unique insurance needs for the condo owner.
- Differences in Dwelling Coverage
If you own a home, then you need enough dwelling coverage to cover the total cost of rebuilding your home and the other structures on your property (such as fences, carport, sheds, etc.). Because the cost of completely rebuilding a home is considerable, homeowners need to secure high coverage limits which will translate into higher insurance costs.
In contrast, if you own a condo, then you only need enough dwelling coverage to rebuild the interior of your unit. This is because all damages to the actual structure of the building (exterior walls, hallways, elevators, etc.) will be covered by the condo association.
- Differences in Personal Liability Coverage
If you own a home, then your personal liability risks are higher than a condo owner’s. This is because you are responsible for all the injuries that take place within your home and on your property. Naturally, higher risk means higher coverage limits, and this coverage comes at a cost.
In contrast, condo owners only need to worry about the accidents that take place within their unit. The liability issues that arise in your building’s common areas (outdoor spaces, pool areas, elevators, hallways, etc.) are your condominium association’s responsibility. Because your personal liability risks are less pressing, condo policies usually have lower personal liability coverage limits. This means that condo owners can enjoy lower rates than homeowners.
This is how home and condo insurance differ. Do you have further questions about your home or condo coverage? If so, then contact the experts at Remland Insurance in Orange, California. Our dedicated team is eager to assist you with all your personal coverage needs today.