We need to first determine if your condo association’s master policy provides any coverage for the interior portion of the unit, which could reduce the amount of dwelling coverage you need to buy.
There are three types of master policies:
“All In”: This means the master policy insures BOTH the interior and exterior surfaces of your unit. In terms of property, you really need to concern yourself only with insuring contents (furniture, clothes, electronics, etc.). Any fixtures that are attached to the walls, such as kitchen counters, cabinets or showers, for example, would fall under the condo association’s master policy. This includes improvements made by you or a prior owner of the unit.
“Single Entity”: This typically provides coverage for the building structures, common areas and fixtures in individual units, but not personal property or improvements made by you or a previous owner. Your personal stuff and renovations will not be covered unless you insure these on an HO6 (unit owner) policy.
“Bare Walls In”: This means everything inside of your apartment’s four walls would need HO6 insurance. Coverage is limited to the basic structure of the building, including fixtures and furnishings collectively used. Therefore, items such as floors, sinks, cabinets, etc., are NOT covered. Neither are upgrades and improvements added by you or a previous owner. Your personal property is also not covered.
Before purchasing an HO6 policy, you should review the association’s master policy and bylaws. It’s important to have an understanding about what is and what is not covered, so you don’t leave potential gaps in coverage.
Article by : Alexander Brown, Agent & Manager at Kinneman Insurance