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Condominium associations generally are responsible for their complexes’ common areas, and that responsibility creates both property and liability risks. One way that condominium associations in California can protect against many of these risks is by purchasing a condo master policy.
A condo master policy is a specialized policy for condominium associations. The coverages in these policies are different from the provisions included in most other types of policies, and there are usually multiple coverages in these policies.
Broadly speaking, most condominium associations in California should consider condo association insurance. Not carrying insurance can lead to devastating losses that necessitate special assessments, and insurance is often even required by loan terms and/or association bylaws.
Exactly what areas a condo association insurance policy covers are dependent upon the policy’s terms, conditions and exclusions. In many cases, a policy may cover:
Policies sometimes cover other kinds of common areas as well. An insurance agent who’s familiar with condo association insurance can help associations find coverage for any unique common areas that they’re responsible for.
Condo master policies provide various levels of protection, and policies can be categorized based on how much they cover within units:
Modified single entity policies are also referred to as “all-in policies.”
What level of policy condo associations purchase is usually up to them, although bylaws might stipulate a specific type of policy.
Premiums for condo master policies vary, because they’re based on many factors. Some of the items that will likely impact an association’s payment include the:
An independent insurance agent can help associations find out how much purchasing a policy for their complex will cost. In general, premiums are affordable when spread across all unit owners and 12-months’ worth of dues. An independent agent can ensure associations find the most affordable policy that provides all necessary protections, though, because independent agents are able to compare policies across insurance companies.
Insurance companies offer several ways to save on condo master policies. Below are a couple of the more common opportunities.
First, insurance companies often offer various discounts. These may range from property discounts for approved security features, to loyalty or new customer discounts. Associations should check with their insurer to see what discounts are available.
Second, raising deductibles generally results in lower premiums. Raising deductibles increases an association’s risk exposure in the event of a claim, but the amount of additional exposure is limited. In return, the premium savings can be substantial.
For help finding a condo master policy, contact the independent insurance agents at Crusberg Fuller. Our California agents have the expertise necessary to find you the best available policy, and we can recommend the best policy no matter what insurer offers it.
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