Dear
Jasmine Place Residents,
We
wanted to once again follow up to suggest everyone add this rider to
their insurance.
What is loss assessment
coverage?
Loss
assessment coverage is protection condo owners can use on claims involving the
building or its common areas. In most condo communities, your homeowners
association (HOA) has its own insurance that covers incidents outside of your
personal unit. However, these claims sometimes exceed the HOA master policy
limits. If that's the case, you and your fellow condo dwellers might be asked
to step in and make up the difference. Condo loss assessment coverage can help
you avoid paying out of pocket when a common area claim requires your
individual assistance.
Potential hazards for condo owners:
Sure, loss assessment coverage sounds important, but will it really ever come into play? You might be surprised at the costly perils that can happen to or in a condo building — and just how quickly you might be called on for help.
1. There's been major weather damage to the outside of the building
Let's
say hail or wind strip away major parts of the building, leaving $550,000 in
needed repairs. Problem is, your HOA master policy only carries $500,000 in
property damage coverage. In which case, the HOA might assess the extra $50,000
to the condo owners — if you're in (for the sake of easy math) a 50-unit
building, that's $1,000 you have to cough up. Loss assessment coverage can
usually cover that cost for you, helping make sure untimely damage doesn't put
unexpected strain on your personal finances.
2. Someone's been injured in a
common area
Chances
are you don't spend too much time worrying about what happens to the visitors who
come in and out of your building — many of whom you don't know and never see.
But because your HOA is in charge of the common areas of the condo community,
you have a partial responsibility for whatever happens to guests on the
property.
If
someone breaks a leg on the tennis court, has a mishap in the pool area, or
simply slips on the front entrance to the lobby, their injury bills could
exceed the HOA liability coverage. Luckily, loss assessment coverage can cover
your end of things (up to your limits) and help you avoid being left on the
hook for an injured guest's medical fees.3. Shared property inside the building has been damaged
At
times, living in a condo probably feels similar to living in an apartment. One
big difference, though, is that in an apartment building, the shared and
structural items of the building (usually) belong to a landlord or management
company. In a condo, on the other hand, you and your fellow residents jointly
own the property yourselves.
So
if a fire, explosion, or other covered loss damages the elevators, lobby,
carpeting, inner walls, etc., you might be asked to shoulder part of the load
in repairing them if the cost goes beyond the HOA master policy limits. Loss
assessment coverage helps you keep the building running and make the fixes you
and your neighbors can't do without.
How much loss assessment
coverage do i need?
When
deciding how much condo loss assessment coverage to get, you should first take
a close look at your HOA master policy. This will shed light on what the HOA is
responsible for versus what you're responsible for, how high their coverage
limits go, and whether they have special deductibles for certain hazards.
As
a general guideline, it's best to get as much loss assessment protection as you
can comfortably afford for the greatest peace of mind against unpredictable
mishaps. Grab a free condo insurance quote today to start planning your policy.
Please
reach out to your insurance agent!
Thanks
much,
Jasmine
Place Board of Directors 