Maintenance fees that are paid to the Homeownerâ€™s Association (HOA) usually include insurance coverage that the Association pays out to an insurance company. This insurance generally covers the buildingâ€™s exterior. The maintenance fees are also designed to cover maintenance of common areas and periodic improvements to the building.
The insurance that is provided by the HOA does not cover the inside of the unit. For coverage of the inside of the unit there are various insurance and warranty options that are available to unit owners for an additional cost. Wall to wall insurance generally covers internal unit structures in the event of an accident, storm, etc. (not wear and tear/lack of maintenance/product defect or malfunction) and has a deductible. Contents insurance usually also has a deductible and it may cover appliances, furniture and personal belongings in the event of theft or damage caused by an accident, storm, etc. (not wear and tear/lack of maintenance/product defect or malfunction). A Home Warranty also represents additional coverage, requires a service fee for an on-site professional assessment (generally under or around $100), does not have a deductible and it generally covers various "working" items (not furniture or structures such as walls) depending on the plan such as appliances, A/C unit, electrical, plumbing, etc., in the event of an accident, storm or a product malfunction (not theft).
Here are some possible scenarios: Letâ€™s say a storm hits and damages the external window of a unit and the interior of that unit is flooded. The HOA may cover the repair or replacement of the external window but it will not cover the water damage inside the unit. Wall to wall insurance may cover water damage to the unitâ€™s interior walls and contents insurance may cover furniture that was damaged by water. Another example: If the dishwasher malfunctions and floods the unit, the home warranty may repair or replace the dishwasher but it will not cover the water damage to the walls or to the contents caused by the water damage, which may be covered by wall to wall and contents insurance. One more example: If the A/C unit malfunctions, a home warranty may repair or replace the unit, but it will not cover mold that may build up due to a nonworking A/C unit, which may be covered by wall to wall insurance.
All of the above have specific coverage requirements, limitations and exclusions so please check with your local insurance or home warranty specialist. The information I have provided does not constitute professional advice and is only intended to provide overall information on the subject.
Feel free to contact me for further information on all of your Real Estate needs.
Home Run Real Estate
As others have pointed out, each community and association can interpret their responsibilities to the owners differently. The bank, however, takes only one view....buy the insurance.
Here's the situation.
If the unit above develops a leak in the plumbing of the tub it will eventually show in your master suite....FIRST! The association will repair the leak and update the plumbing. Some will replace damaged wall board.. When the plumbing is watertight and up to code, most associations consider their job done. The owner may be left with hiring someone to repair the wall board, (big holes remain that provided access to the plumbing), repair room wallboard (wicking) replacing trim, painting. These expenses are usually covered by the insurance including any "cantaminate' remediation in the event a drain (sewer) line from above failed.
If the condo is constructed around 1970 and has not had the plumbing fully replaced, it is highly likely you will become VERY familiar with this process.
Without the insurance, and owners with limited cash resources, many condo owners could end up with a wreck of a condo which the bank could inherit. Perhaps one purpose of the association inquiries, during the interview process, regarding income is to assess ability to cover such costs. Now you've got the whole story.
Best of success,
Annette Lawrence, Broker/Associate
Remax Realtec Group
Palm Harbor, FL
As you can see by the prior responses, in most cases you will need additional insurance coverage for your condo, as it relates to the interior of your unit. This would cover any damage to the interior of your unit from fire, hazard, damage from upper floor unit, as well as any damage to your personal affects. If you are going to be financing your purchase, your lender may require for you to have this additional insurance to the Master Hazard Policy covered by the association.
Good luck with your purchase. Should you have any additional questions, please feel free to contact me.
Lila Lopez, CRS< CDPE, -Pro
RE/MAX Advance Realty
Many condo associations are different. Which building did you buy?
Most HOA's cover insurance for the building and common areas. This can include hazard, flood and windstorm. They generally does not cover anything inside of the walls of the individual units, including the drywall, floors and any contents (personal items, furniture, appliances, etc.) in the unit.
Email me or call me anytime and I will be happy to answer the question much more in depth with examples and recommendations for good condo insurance agents with good rates.
LUXURY RESIDENTIAL SALES
THE CHAD CARROLL GROUP
DOUGLAS ELLIMAN REAL ESTATE