Buying a Condo? Here’s What Your Building Insurance Does and Doesn’t Cover!

Condos offer a unique lifestyle, blending the benefits of homeownership with the convenience of shared amenities and maintenance. However, when it comes to protecting your investment, understanding the nuances of condo building insurance is crucial. Many condo owners mistakenly believe that their building’s insurance policy covers all their needs, but this isn’t always the case. In fact, personal insurance plays a vital role in ensuring you’re fully protected. Let’s dive deeper into what your condo building insurance covers—and what it doesn’t—so you can make informed decisions about additional coverage.

What Condo Building Insurance Typically Covers

Condo building insurance is designed to protect the overall structure of the building and the shared areas that all residents use. Here’s what’s generally covered under your condo corporation’s building insurance policy:

• Common Areas: This includes spaces like hallways, lobbies, elevators, gyms, and other recreational facilities. These areas are shared among residents, and the building insurance ensures they’re protected in the event of damage or a covered loss.
• Building Structure: The exterior structure of the condo building is also covered, including the roof, walls, windows, and foundation. This ensures that major structural components are safeguarded.
• Liability in Common Areas: If someone is injured while using a shared space, such as a lobby or gym, the building insurance will typically cover legal and medical costs.
• Standard Unit Fixtures: Some policies also include coverage for the standard fixtures inside individual units. These are usually defined in the condo corporation’s declaration and may include things like basic cabinetry, countertops, and flooring as originally installed by the developer.

What Condo Building Insurance Does Not Cover

While building insurance provides important coverage for the overall structure and shared spaces, it does not provide comprehensive protection for individual condo owners. Here are some key areas where building insurance typically falls short:

• Personal Property: Items inside your condo, such as furniture, electronics, clothing, and other personal belongings, are not covered by the building’s insurance. To protect your personal property, you’ll need a personal insurance policy.
• Unit Improvements: If you’ve made any upgrades or renovations to your unit, such as installing high-end appliances, custom cabinetry, or hardwood floors, these improvements may not be covered by the building insurance. Personal insurance can help safeguard these investments.
• Personal Liability: If someone is injured while inside your condo unit, or if you accidentally cause damage to another unit (for example, through a kitchen fire or plumbing leak), you are personally responsible. Building insurance does not cover personal liability for these types of incidents, which is why personal insurance is essential.
• Living Expenses: If a covered loss, like a fire or flood, makes your unit uninhabitable, the building insurance will not cover the cost of temporary accommodations. Personal insurance can help pay for alternative living arrangements while repairs are made.

Why Personal Insurance Is Essential

Given the gaps in building insurance coverage, obtaining personal insurance is crucial for condo owners! Without personal insurance, you could find yourself facing significant out-of-pocket expenses in the event of damage, loss, or liability issues. By investing in this additional insurance policy, you’ll have peace of mind knowing that you have comprehensive protection for your home and investment.

Questions about condo ownership? Reach out for more information!