If you’ve ever owned a home, then you know how important it is to protect your property with a home insurance policy. The same can be said about owning a condominium. Just like a home insurance policy, a condo policy (also known as HO6 insurance) ensures your condo unit is protected from certain listed perils.
But what is left out of a condo insurance policy? Some perils not typically covered by your condo insurance policy are noteworthy (to say the least!).
What Isn’t Covered by Condo Insurance?
Typically, condo insurance covers the same perils as a homeowners insurance policy, although covered perils can vary according to the insurance company you use. On the other hand, excluded perils are pretty much the same as specified in a home insurance policy. These named perils include:
Floods: Condo insurance doesn’t cover flooding, especially in flood-prone areas. So if you want flood coverage, you need to purchase separate flood insurance from your insurance company. In addition, the Federal Emergency Management Agency (FEMA) offers flood insurance through the National Flood Insurance Program (NFIP).
Earthquakes: You’ll also need to purchase additional coverage for earthquake insurance, especially if you live in an area that has a lot of earthquakes. This protection also extends to the personal belongings of condo owners, which aren’t protected under a standard homeowners insurance policy.
Sewage backup: Another area that you would think would be covered by condo insurance is sewage backup (and the resulting water damage). Surprisingly, this isn’t a covered peril. For protection, you’ll need to invest in water backup coverage, which protects your condo unit from sewage and sump pump backups.
Wind and hurricanes: While many insurance policies cover damage from the wind, some condo policies in areas prone to hurricanes don’t. If you want hurricane coverage, you’ll need to purchase separate hurricane insurance, which provides coverage for damage from wind and wind-driven rain.
Acts of war: Acts of war are not a covered peril, which includes invasions, insurrections, revolutions, and military coups. Surprisingly, acts of war don’t always extend to terrorist attacks, which are usually covered under a condo insurance policy.
Nuclear accidents: Nuclear accidents are another excluded peril from a condo insurance policy. Coincidentally, you can purchase nuclear insurance if you live in an area that might see a nuclear accident, such as near a nuclear power plant.
High-Value Item Coverage
In addition to certain excluded perils, your standard condo insurance policy won’t provide coverage for high-value items in your unit, such as jewelry and works of art. If you want coverage for your high-value items, you need an endorsement, or in the case of a very high-value item, a scheduled endorsement. You can find out more about both types of endorsements below.
Endorsement: An endorsement covers a specific category of personal property in your home, including the jewelry in a jewelry box or works of art. The endorsement pays out a certain amount in case of loss or damage, regardless of the total value of all of the items.
Scheduled endorsement: A scheduled endorsement offers personal property coverage for items of extremely high value, such as an expensive diamond ring or a rare piece of art. The scheduled endorsement covers that particular item and nothing else. In addition, as a part of getting the endorsement, you have to get the item appraised.
You can see why it’s important to make sure that your condo unit is properly covered. By double-checking your condo insurance policy, you can make sure you’re covered for all of the potential perils that are common in your area, whether you live on a flood plain or in an area that has frequent earthquakes. In addition, you can also opt for coverage for your more valuable items of personal property through endorsements.