Property Management

Condominium Insurance, Part 1: The Master Policy

Condo insurance The Master Policy

Condo owners have unique insurance requirements, because they own their property both collectively and individually. For this reason, condos have two different types of insurance – the master insurance policy, which covers the entire building, and the insurance policy for the unit itself, which covers all of the owner’s belongings inside the condo.

The master insurance policy is selected and managed by the homeowners association, and is paid out of the monthly assessments made by all owners. This policy covers the building as a whole, including the structure, the building exterior, all common areas in case of disaster or accidental damage.

The master policy also has liability coverage. If someone falls in the lobby of your building and decides to take legal action, the building will be covered and will not have to pay damages from the association’s reserves.

There are two major types of master insurance policies – “walls in” and “all-in”. Walls in policies are the standard, and cover everything from the exterior to the interior walls of the building, but not anything inside the actual condo. All-in policies are generally more expensive and also cover certain large interior fixtures, such as cabinetry and bathroom fixtures. The type of master policy you have will dictate your needs when it comes to your individual unit insurance policy.

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