Understanding insurance coverage is crucial for all residents and owners at The Atrium Condominiums. Below is an overview of what the HOA building insurance covers, what owners need to insure independently, and additional recommendations for landlords renting out their units.
What the HOA Insurance Covers
The HOA carries a master building insurance policy, which provides coverage for:
- The structure of the building, including common areas such as hallways, lobbies, and shared amenities.
- The roof, exterior walls, and foundation.
- Electrical, plumbing, and mechanical systems within common areas.
- Liability coverage for accidents occurring in common spaces.
- Fire suppression system damage – Since the fire suppression system is a common element, any resulting water damage from sprinkler activation or system failures is covered by the HOA insurance.
This insurance does not cover the interiors of individual units, including personal property, fixtures, or any upgrades made by the unit owner.
Why Owners Need Their Own Insurance
Since the HOA insurance only covers the building structure and common elements, unit owners must obtain their own condo insurance (HO-6 policy) to cover:
- Interior unit improvements, including flooring, cabinetry, and fixtures.
- Personal belongings such as furniture, electronics, and clothing.
- Liability protection in case of accidents within the unit.
- Loss of use coverage if the unit becomes uninhabitable due to a covered peril.
- Deductible coverage for special assessments that may be passed to owners after a covered loss.
Why Landlords Should Have Rental Property Insurance
If you are renting out your unit, standard condo insurance may not be enough. A Landlord Insurance Policy (DP-3 or similar) is strongly recommended, as it provides:
- Coverage for damage to the unit due to fire, water leaks, or other covered losses.
- Liability protection in case a tenant or guest is injured within the unit.
- Loss of rental income if the unit becomes uninhabitable due to a covered event.
Renter’s Insurance for Tenants
While not required by the HOA, it is strongly recommended that tenants obtain Renter’s Insurance (HO-4 policy) to cover:
- Personal belongings.
- Temporary housing in case of displacement.
- Liability for accidental damage to the unit.
Key Takeaways
- The HOA insurance covers the building structure and common areas, but not the interior of units.
- Owners must obtain their own HO-6 policy to cover unit interiors, personal property, and liability.
- Landlords should have rental property insurance to protect against tenant-related risks and lost rental income.
- Tenants should obtain Renter’s Insurance to protect their belongings and liability.
- Damage caused by the fire suppression system is covered by the HOA insurance, as it is part of the building’s common elements.
For any insurance-related questions or to review your coverage requirements, please contact the HOA management team or consult your insurance provider.