Loss assessment coverage is an optional add-on to your condo insurance policy that can help in the event of an accident in a shared area of the condo property, such as lobbies, stairwells, pools, outdoor spaces and more. Ordinarily, the homeowners master policy provides coverage for incidents that occur in these shared areas; however, if the amount of the damages exceeds the master policy’s limits, the residents of the condo may end up having to contribute financially (whether they were involved or not). By adding loss assessment coverage to your condo insurance policy, you may be able to avoid paying out of pocket for these types of expenses.
Do I need loss assessment coverage?
Loss assessment coverage is not a required add-on to your condo or HO6 insurance policy. However, it can come in handy in the event of unexpected damages. Loss assessment claims could include personal liability incidents in shared areas, vandalism to the building’s exterior or property or even damage to the building’s shared interior spaces resulting from fire, certain natural disasters and more. These types of accidents could cost thousands of dollars to repair – and if the master policy’s limits are exceeded, the tenants are required to collectively pay the difference. Loss assessment coverage can protect you financially in the event of such an incident.
How much loss assessment coverage do I need?
The policy limits you select for your individual loss assessment coverage should depend on your HOA’s master policy limits. Talk to your HOA association about the master policy’s loss assessment limits before getting a condo insurance quote.
Learn more about what condo insurance covers.