SUGGESTIONS FOR UNIT OWNER'S

INSURANCE NEEDS

PROPERTY AND LIABILITY PROTECTION

The following types of homeowners policies are available in Maryland: HO-6 for a condominium unit and HO-3 for a house in a HOA (Homeowners Association) or PUD (planned unit development). Put bellow or next to it "Do you rent your unit/house? Make sure you tell that to your agent so that you get the proper coverage (the difference in premium is minimal). Also, request in your lease that your tenant purchases HO-4 tenant's coverage a.k.a HO-4. Bellow are some suggestions for homeowners insurance, however, This  is a guideline only.  Always, discuss your insurance needs and coverage's with your agent.

Unit owners should obtain a homeowners insurance policy, (aka HO - 6), to protect, their personal insurance needs.  The HO - 6, policy provides coverage for personal effects, improvements to the unit, as well as personal liability protection.

Homeowner policies generally insure against, Fire, Lightning, Hail, Theft, Freezing,Windstorm, Vandalism, Riot or Civil Commotion, Accidental Discharge or overflow of water from within a plumbing, heating or air system, plus other perils specified in the policy.

Liability coverage is also included in the condo-owners policy and should be dovetailed with a Personal Excess, or Umbrella Liability policy. The liability protection can be extended to include rental units. If you do not have an Excess or Umbrella Liability policy, ask your agent about it. It is an inexpensive yet, extensive coverage that your homeowners agent should have discussed with you.

ADDITIONAL COVERAGES AVAILABLE

Additions and Alterations -  Changes made to the unit must be insured by the unit owner, this coverage is essential. Improvements, or additions to a unit, are always the unit owner's responsibility and must be insured with this endorsement. This coverage may also provide protection for interior walls, ceilings, plastering and permanent fixtures which were installed in your unit at the time of construction. However, if your condo was built after the Maryland Law Amendment of 7/82, the master association policy is primary. Discuss this with the master policy agent. If your condo was built prior to the MD Condo Act of 1982 than the bylaws should define and describe what constitutes a unit..

Personal Property – Your furniture, clothing, dishes etc, are insured under this section.

Replacement Cost Endorsement - Will eliminate the deduction for depreciation at the time of loss.

Rental To Others Endorsement - Since the HO-6 policy is designed for an owner-occupant, this endorsement is necessary to extend protection for a unit being rented.

Loss Of Rents - Can be purchased to protect the income lost due to an insured peril, causing the tenant to move out.

Loss Assessment Coverage - Will indemnify a unit owner, for an Association assessment, levied for reimbursement due to a deficiency in the liability limits, of the master hazard policy. Master policy deductible assessments can be covered as well.

Water Backup Of Sewer or Drains - Insures for direct loss caused by water, which backs up through sewers or drains and which is not caused by negligence of the insured.

FLOOD INSURANCE

A master flood policy for a condominium association insures the building and the units with replacement cost protection, from flood damage. Unit owners do not need to buy a flood policy to insure their individual unit because it is covered under the master policy. However, flood protection is the unit owner’s responsibility if they want coverage for their personal contents. If a flood causes a building to collapse, the HO-6 policy will not cover the contents of the unit, because the claim is due to a flood. Therefore, ask your agent about flood protection.

This  is a guideline only.  Always, discuss your insurance needs and coverages with your agent.