CONDOMINIUM UNIT OWNERS HOMEOWNERS INSURANCE HO-6
Prior to purchasing an HO-6 insurance policy, analyze the bylaws & declarations of your condominium. From this analysis, you can see the protection that you are lacking and will need. An HO-6 policy is an essential component for the replacement of your personal property, improvements and betterments and personal liability. This policy also provides additional coverage for storage of your personal belongings and coverage for you to stay in a hotel, if you cannot live in the condo unit during repairs. In Maryland, you also need to purchase protection to cover paying the first $5,000 of the master insurance policy deductible (if an insurable event originates from your unit). Many condo owners believe that the association’s master policy provides adequate protection. However, the insurance that protects the building does not protect the interior of the individual condominium units. A condominium owner must know what an HO-6 policy covers and how much coverage is on the building, improvements and betterments and personal property.
UNITOWNER AS LANDLORD INSURANCE
For those who acquire rental and investment property and do not need to insure personal possessions, the Dwelling Fire Insurance Policy provides the coverage needed. Some carriers have now developed an HO-6 policy form to address the rental and investment property. As the unit owner, you are responsible for repairing and replacing the unit’s elements as stated in the association’s governing documents.
You would also be responsible for paying the first $5,000 of the master policy’s deductible, if an insurable event originates from a unit that you own. Dwelling Fire policies are not broad form and need to have special condo coverage added, i.e., loss assessment coverage.
RENTERS INSURANCE HO-4
Many renters seem to mistakenly believe that their landlord’s insurance policy covers their personal belongings. The unitowner (as landlord) does not insure your personal possessions. The HO-4 insurance policy typically covers items from theft, fire, water damage and other coverage specified in the renters’ policy. The renters insurance will also pay for you to stay in a hotel, if you are unable to stay in the rented condo, due to a covered claim. The policy also includes liability coverage that protects you against any claims as a result of injury to someone else as well as any property damage that you are legally liable for.
Submitted by Connie Phillips