Colorado HOA’s Condo and Apartment Insurance
When looking to buy or rent a condo or an apartment, one of the first things people should consider is what insurance they will need. Unlike houses, condos and apartments may come with complex restrictions or additional fees. Many are run by homeowner’s associations (or HOA’s) that collect dues from residents that cover the cost of building maintenance, snow removal, and, occasionally, utilities.
HOA’s often have a list of restrictions that place limits on what kind of renovations can be done on the inside of the dwelling or even what kind of decorations can be placed on the outside. In Colorado, HOA’s are required to register with the state and comply with regulations that govern who can run the organization and how it can be run. For example, HOA’s are also often required to carry liability insurance that covers the building in the event of a fire, flooding or other event that can affect the building itself.
This is where it gets muddy. HOA insurance in Colorado only covers a narrow scope. It covers the land that the property rests on, shared common areas (such as hallways, pools, gyms, lobbies, etc.), shared amenities (gym equipment or elevators), and the exterior structure of the building (this includes a dwellings walls, ceilings, and flooring. It can be easy to assume that if something happens, these policies will cover all repairs needed or anything that needs to be replaced. They don’t.
One thing we have seen often in Colorado is how much damage flooding can do. For example, imagine a flash flood occurred and water got into one of the main floor suites while the occupant was away for a few weeks. The damage went unnoticed until they returned and by that time the walls were full of mold and most of the flooring and possessions were water-damaged, what would be covered? HOA insurance would cover removal of the mold, and perhaps replacing of the walls, and that’s it. If there were extensive renovations done in the apartment, their replacement may not be covered, and any of the occupant’s possessions would not be covered as well. That is why we recommend people purchase renter’s insurance or condo insurance.
If you are renting a dwelling (apartment, condo, etc.) your landlord or HOA’s insurance will not cover the cost to replace possessions. Having a renter’s insurance policy protects you in the event of fire, theft, vandalism, ice damage, and more. It goes where you move and is often inexpensive. With a small deductible, policies can be purchased at any level of coverage. Although, it is important to note that in Colorado, many policies do not cover for flood damage, as that is a separate coverage.
Like renter’s insurance, condo insurance covers what your HOA may not. If you have remodeled your kitchen, it can cover the cost to replace damaged appliances or cabinets. It also covers loss of use, so if you have to stay elsewhere while repairs are going on, the insurance covers that as well. An add-on that many people enjoy is identity theft protection. As well, many HOA’s require condo owners to have their own insurance as part of their responsibilities.
Having the right level of coverage can make a difference when the unexpected happens. At DC Insurers, we have helped people find the right property insurance coverage for years. Contact one of our property insurance specialists and see what they can do for you.