THIS POST HAS BEEN UPDATED WITH THE NEW MARYLAND INSURANCE ADMINISTRATION BULLETIN.  The amended law affects detached units organized under a condominium regime and is effective Oct. 1, 2023.

Why the change? In recent years, some real estate developers have established condominium single-family homes that are not physically attached to other condo buildings. This has led the Maryland legislature to make the following changes regarding insurance coverages, effective Oct. 1, 2023:

  • When the unit is attached, condo associations will generally continue to be responsible to insure the common elements and the units, except improvements to the unit made by unit owners over the years.
  • When the unit is fully detached, the unit owner will need to insure his or her unit with a full homeowner’s insurance policy (sometimes called an HO-3) rather than through a traditional condo unit owner policy (often referred to as an HO-6). The Unit Owner must cover the “entirety of the unit” (not just improvements and betterments and personal property.  This change has significant implications in terms of coverage. Common elements will continue to be the responsibility of the condo association to insure.    You should review your Condo Homeowners policy to verify that you have enough building coverage to replace the home.  You may need to consider converting to a HO-3 or HO-5 homeowners’ policy, depending on what works best for your situation.  Please remember that you also need to review and add loss assessment coverage.

If your condo unit is a townhouse with at least one common wall with your neighbor, this change does not apply to you.

If your condo unit is an apartment with other adjoining apartments on the same floor or multiple floors, this change does not apply to you.

If you are in a detached unit (single Family home) under a condominium form of ownership, you need to adjust your coverages.  Feel free to contact us if you have questions about coverage.

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