Downsizing to a condo? What to know about insuring it

If you’re ready to streamline and simplify (hello, condo; goodbye, lawn mowing), know that insurance to protect your condo is different from insurance to protect a single-family home – almost a hybrid between homeowners and renter insurance.

 Like the homeowners insurance you’re likely familiar with, condo insurance offers important liability protection (if, for example, a visitor slips on your freshly mopped floor and gets hurt), loss of use (if your unit is damaged by smoke or water and you can’t live there) and coverage for your personal belongings. And while condo insurance can be set up to protect finishings like countertops and floors, its coverage always “stops at the studs.” The building’s exterior and structure is covered by the condominium complex’s master policy. Grounds and common areas like the gym and pool are also covered separately and paid for with your monthly condo dues.

Condo insurance is important for your peace of mind, and mortgage lenders require you to carry it (just as they do for single family homes), separate from insurance provided by the condo association. Some condo boards require unit owners to carry it, too, whether or not they have a mortgage.

Once you’ve settled on a condo, you’ll want to learn exactly what your complex’s master policy covers so we can make sure your PEMCO coverage picks up where it leaves off. Since you’ll likely be downsizing, it’s also a great time to update your inventory of personal belongings to give you a better idea of the coverage you’ll need.

Your PEMCO condo policy automatically includes $1,000 in “Loss Assessment Coverage” to take care of unit-owner responsibilities you might have under your condo association master policy. For example, if wind damages the roof, owners might be asked to pay a percentage (“loss assessment”) of the master policy’s deductible. As long as it’s a type of loss covered under PEMCO’s loss assessment protection, PEMCO would pay, saving you those out-of-pocket costs up to your limits. You also can buy higher loss assessment limits, which many unit owners do.

PEMCO’s proud to be your defender as your needs change throughout your life. If you’re just beginning to explore the condo lifestyle, check out these tips to help you get started.