Renters and Condo Owners Insurance
Last updated November 2015
If you are a renter or a condo owner, you can purchase insurance similar to homeowners coverage. As with homeowners insurance policies, rates for renters and condo owners vary significantly from company to company, so you’ll want to shop around.
Renter and condo policies usually cover personal property for its actual cash value; you can purchase an endorsement for replacement-cost coverage. As with homeowners insurance, special limits of liability apply to certain categories of items. If you aren’t sure your valuables are covered, ask your agent for clarification. If they are not, you can increase the special limits or purchase an individual floater for each item.
Coverage for additional living expenses (expenses that result from loss of use of your dwelling) usually is for an amount up to 30 percent of the coverage of your personal property under a renters policy and up to 40 percent of the coverage of your personal property under a condominium owners policy.
Renters and condominium owners policies do not cover damage to your building’s basic structure; landlords and condominium associations should have insurance to cover such losses. But condominium owners policies do cover some structural damage. The extent of this coverage varies significantly, and how much structural coverage you need depends on how much coverage is provided by the condominium association’s policy. Some condominium associations’ policies cover built-in fixtures like sinks, bathtubs, and electrical wiring. Others stop coverage at the unfinished walls, leaving you responsible for any fixtures or improvements inside. Purchase a condominium owners policy that takes over where the condominium association policy’s coverage ends. (Some renters policies also allow you to purchase coverage for improvements you make to an apartment.)
If you negligently cause damage to your building, the landlord’s or condominium association’s insurance company may sue you to recover its expenses. The liability coverage in your policy should protect you in such an event.
Most condominium policies provide loss assessment coverage, for up to $1,000. This protects you if your building association assesses you an amount to make up for a loss it has incurred. For example, if there is damage to the building, the association might make an assessment to cover the deductible in the association’s policy or for the difference between an actual cash value settlement and the replacement cost.
Consider purchasing your condominium owners policy from the insurance company that sold the policy to your association. If it offers a competitive rate, insuring with it may reduce the time it takes to settle claims where the loss is partly the association’s and partly your own.