There are two layers of property and liability insurance with condo ownership. Insurance solutions for SLC, UT include the first layer or owner policy referred to as an H06, and the second layer is called the Master Policy.
H06 is the unit owner policy. Unit owners are a liability for a slip and fall, dog bites, and accidents that happen on your property. The contents you own inside your condo are also covered under an H06 insurance policy.
The master policy covers the liability of the association and the actual building structure. In Utah, the law for master policies is “walls in” or called “all-in” coverage. The master policy outlines the responsibilities of the insurance policy. “Wall in coverage” includes property that is attached to the structure like alterations, appliances, fixture, and improvements that are a part of the building. As an example of a liability claim on the policy would be if someone drowns at the community swimming pool, was injured in a common area of the building or if the building caught on fire. The master policy would cover the damages. There is a deductible on the Master Policy just like on other insurance policies, however.
Do note that when there are liability or building property losses that are over the Master Policy deductible, the claim will go on the Master Policy. However, if the claims are under the Master Policy’s deductible, the claim will go on the individual unit owner’s policy.
Make sure you review the covenants, conditions, and restrictions of your condo association. You need to know what you Master Policy deductible is. Once you know what the deductible is, you can structure your unit owner policy to make sure there are no gaps in coverage.
Many condo associations are looking for insurance solution in SLC, UT that include higher Master deductibles like $10K or $25 K. They would rather smaller claims to onto unit owner policies. If you are upset about this idea, note that this is beneficial in the long term to condo owners. The owner policies are not nearly as claim sensitive as Master policies. You can get lower rates on the Master policies if you keep the small claims off the loss history and only report a larger significant claim on the Master Policy. The lower the rates are for the Master Policy, the better it is for all unit owners over time.
There are several steps to ensure that you have the proper insurance solutions for SLC, UT coverage on our condo. One step is to confirm with the Board of your association what your associations’ master deductible is. After you have this information, contact your insurance agent to ensure the coverages on your unit owner’s policy is adequate.
Coverage A – Dwelling $____Must be a minimum of the association deductible)
Coverage C – Personal Property (Please discuss with your agent to find an appropriate limit)
Coverage D – Loss of Use
Liability: Minimum of $100,000
Medical Payments: Minimum of $1,000
Dwelling Insurance. Your dwelling should be a minimum of the Master Deducible. Losses over the deductible amount can be filed on the master association policy. Anything under that deductible, go on this policy.
Personal Property. Discuss the limits and needs with your agent. Make sure the limit is sufficient to cover all your personal content in the condo unit. Let our agent know if you have any significant value like furs, fine arts, jewelry, firearms, musical instruments, or outdoor equipment. Many policies have limitations on specialty items. Make sure you are covered and review your contents with your agent.
Loss of Use. Coverage on living expenses provides coverage if your unit becomes inhabitable. Loss of use coverage reimburses you, the unit owner for qualified expenses or if you need to stay in a hotel after a fire destroys your unit and all the contents.
Liability: Liability protects policyholders and family members from lawsuits for bodily injury or property damage to a third party. Great examples include your dog bites someone or someone slips on your premises and is seriously injured. Liability can also cover damages if your kid hits a baseball, and it damages someone’s property or injures another person. The coverage minimum is $100K, but depending on your assets and situation, you may need more.
Medical Payments: A unique coverage included in an HO6 unit owner policy are medical payments. Medical payment coverage helps cover injuries that happen to 3rd parties regardless of fault. Liability coverage does not apply to residents of the household. As an example, a friend comes over and cuts their leg on your deck. He is not seriously injured but does need medical attention. This coverage will help prevent future litigation and cover current medical costs.
Ask your insurance agent about sewer drain back up, equipment breakdown, utility line service, as well as earthquake and flood insurance. These issues are not included in a standard unit owner H06, but you can purchase coverage from your insurance agent.
You might advise a renter to obtain renter’s insurance for someone who leases your condo from you. Renter’s insurance will cover their contents in the event of a disaster.
These basic contents are listed on your unit owner’s H06 policy. Once you have received this policy form your condo association, contact your agent to review the policy. Reach out to Risk Manager LLC in Salt Lake City for assistance on any policy questions or changes.