Condo Association Insurance

What is Condominium Association Insurance?

There are many condominium complexes in New York, NY. Within each of these complexes, there are individual condos and common areas. While condo owners are usually responsible for insuring individual condos, condo associations are typically responsible for procuring insurance for the common areas. Most associations do this by purchasing condo association insurance.

Condominium association insurance is a unique form of insurance that’s specifically written to meet the needs of condo associations. It’s mainly used to insure common areas of condominium complexes.

Depending on the layout and features of a complex, the common areas that a policy insures might include:

walkways and exterior steps
foyers and entryways
elevators, stairwells and hallways
units’ shared walls and buildings’ exterior walls
landscaping and fencing
amenities, such as pools, community rooms and fitness centers

Most condominium association insurance policies provide both liability coverage and property coverage for the common areas that they insure. Liability coverage can help pay for legal expenses and settlements associated with suits filed over covered accidents that occur in common areas, which may include slips, falls and similar accidents. Property coverage can help protect areas from damage caused by covered perils, which might include vandalism, fire, burglaries and many other incidents.

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Who Pays for Condo Association Insurance?

Since condo association insurance policies are typically purchased by condo associations, associations are usually the party that actually submits premium payments. Most condo associations in New York, NY pass on this cost to condo owners, though. It’s fairly common for associations to include a condo association’s yearly premiums in the association’s annual assessment, dividing the cost of the premiums evenly among all condo owners.

Condo association policies’ deductibles, similarly, are normally paid by condo associations but can be passed onto condo owners. Since it’s impossible to know precisely when a claim will be filed and deductible have to be paid, deductibles aren’t typically included in annual assessments. Instead, the cost of a deductible is often passed onto condo owners through a special assessment, which can generally be assessed at any time of year.

Because condo association policy’s costs are frequently passed onto condo owners, condo associations in New York, NY should clearly communicate how much condo owners might be assessed. Owners deserve to know how a policy’s premiums will impact their annual assessment and how much a special assessment for a deductible might be. Communicating these details helps owners financially prepare for the assessments they might have to pay.

How Are Bare Walls-In, Single Entity and Modified Single Entity Policies Different?

Most condominium association insurance policies are bare walls-in, single entity or modified single entity policies.

All of these policies can provide similar levels of protection for common areas, but they differ in how much protection they offer for what’s inside condo units:

bare walls-in policies normally cover the structure (walls, ceiling and floor, not including any paint or flooring) of a condo and, sometimes, the unit’s electrical and plumbing
single entity policies usually add coverage for standard features, such as carpeting cabinets and countertops
modified single entity policies generally include all of the above coverages and protection for upgraded features, like granite countertops or hardwood floors that aren’t standard

How Can Condo Associations in New York, NY Obtain Condo Association Insurance?

Condo associations that would like help getting new condo association insurance should talk with an independent insurance agent who’s familiar with the intricacies of condominium insurance. There are several agents in New York, NY who can help condominium associations compare coverages and select a policy.

antalek Moore