Technically “home insurance” covers your place of residence, be that a single family home, condo, cottage, seasonal home, etc.; but don’t be fooled! Not all policies cover the same things. It depends on the type of dwelling. Home insurance for a house differs greatly from home insurance for a condo. Let’s look at six key aspects that distinguish these two types of insurance from one another. An overview below summarizes key differences that you have to know.
1.) Policies involved in the coverage
Most home insurance policies consist of one component.
Condo insurance is built of two components. First is the personal insurance side. This covers the interior of your unit. The second component is the commercial condo policy which is put in place by the condo corporation. This covers common areas such as pool, elevators, building exterior, roof etc.
A house insurance policy can easily cost double that of condo insurance, for the same square footage as a condo. This is because it covers more risks (e.g. your house, gardener, pool etc.).
You’ll pay less for condo owner insurance because you are protecting only a portion while sharing in the costs of the rest of the structure. This is one reason condo living is so attractive for some people. In fact, the average personal condo insurance policy in Canada costs around $27 to $33 per month, but can be as low as $20 a month. Paying more than $35/month? Have an insurance broker look into other policies so you can save money.
3.) Building Coverage
With house insurance, the structure and the building envelope are covered by the same policy.
With condo insurance, the commercial policy covers the majority of the building envelope, which pertains to outdoor cladding, siding, roofing and windows. If your windows are damaged or roof shingles blown away or the parking lot is ruined, this will fall under the commercial policy scope, however, if theft occurs from your locker, your unit is robbed, or the walls inside your condo are damaged, your personal condo insurance policy comes into play.
4.) Adjacent Area
You can add multiple riders to your home insurance policy to cover landscaping, gardens, trees, and even flooding.
Your personal condo insurance only covers your unit – nothing else.
5.) Other Structures
If you have several buildings on your property, such as a garden shed or detached garage, these can be protected under your house insurance policy.
Your condo insurance policy does not cover anything outside of your condo unit with the exception of your locker. If your condo includes a locker, be sure to tell your insurance broker so it can be covered.
6.) Claim Processing
House insurance claims are straightforward and usually processed very quickly.
Condo insurance can be more complicated if a claim involves the unit owner and the condo corporation at the same time. There are simply more details to sort out since, in most cases, both your unit and common areas have been affected. For example, leakages through a balcony door or pipe that bursts in a wall involve both your policy and the condo corporation’s policy.
While there are several key differences between condo and home owners insurance, no one place is better than another to call home. It all depends on your needs and lifestyle. All you have to worry about is that you have the right insurance in place, regardless of if you are enjoying the convenience of a condo or the pride of single-family home ownership.
Remember, too, that every condo corporation is different. You must know what they cover and what’s up to you to cover. Ask for help from your lawyer and realtor to sort through condo documents to ensure you understand both your responsibilities as a unit owner, and your liabilities.
These insights are shared by InsurEye, a leading Canadian platform for consumer reviews, educating Canadians about different types of insurance (Home, Auto, Life and Business Insurance) and offering best rates for condo insurance in Toronto and condo insurance in Calgary.
Source: The Red Pin, 12/09/2015