Condominium Insurance Glossary of Terms

1. Condominium Insurance: Also known as Condo Insurance or HO-6 Insurance, it is a type of insurance that provides coverage for individual condominium unit owners. It typically covers personal belongings, interior structures, and liability, among other things.

2. Master Policy: The insurance policy held by the condominium association that covers the common areas and the building’s exterior. It usually includes coverage for the structure, hallways, elevators, and other shared amenities.

3. Unit Owner: The individual who owns a condominium unit and is responsible for obtaining their own condominium insurance.

4. Policyholder: The individual or entity who owns the condominium insurance policy.

5. Insurer: The insurance company that provides the condominium insurance coverage and assumes the risk.

6. Premium: The amount paid by the policyholder to the insurer for the coverage provided under the condominium insurance policy. Premiums can be paid annually, semi-annually, quarterly, or monthly.

7. Deductible: The portion of a claim that the policyholder must pay out-of-pocket before the insurance coverage starts. Choosing a higher deductible often leads to lower premiums.

8. Coverage Types:

   a. Personal Property Coverage: Protection for the policyholder’s personal belongings, such as furniture, electronics, clothing, and other personal items, against covered perils like fire, theft, and vandalism.

   b. Dwelling Coverage: Coverage for improvements and alterations made by the unit owner to the interior structure of the condominium unit, like built-in cabinets, fixtures, and appliances.

   c. Loss Assessment Coverage: Protection against special assessments charged to the unit owner by the condominium association following a covered loss affecting the common areas.

   d. Additional Living Expenses (ALE): Coverage that pays for temporary living expenses, such as hotel stays and meals, if the condominium unit becomes uninhabitable due to a covered event.

   e. Personal Liability Coverage: Protection against legal claims and lawsuits for bodily injury or property damage caused by the unit owner or their family members to third parties.

   f. Medical Payments Coverage: Coverage that pays for medical expenses for third parties injured on the insured property, regardless of fault.

9. Named Insured: The individual or entity listed on the condominium insurance policy as the primary policyholder.

10. Additional Insured: An individual or entity added to the condominium insurance policy with limited coverage, often applicable in specific situations.

11. Exclusion: Specific risks or events that are not covered by the condominium insurance policy.

12. Unit Assessment: The portion of the insurance deductible or repair costs allocated to a specific unit owner in case of a covered loss.

13. Loss of Use Coverage: Similar to ALE, it covers additional living expenses, but specifically for loss of use of the condominium unit due to a covered event.

14. Appraisal: An assessment of the property’s value, typically conducted by a professional appraiser, to determine its insurable value.

15. Binder: A temporary proof of insurance coverage provided by the insurer until the formal policy is issued.

16. Subrogation: The right of the insurance company to recover its losses from a responsible third party after paying a claim to the policyholder.

17. Unit Improvements and Betterments: Enhancements made by the unit owner to their condo unit, which may require additional coverage beyond the standard policy.

18. Endorsement/Rider: An amendment or addition to the condominium insurance policy that modifies or expands its coverage.

19. Bare Walls-In Coverage: A type of condo insurance policy that covers only the structural elements of the condo unit, leaving the interior fixtures and personal belongings to be insured separately by the unit owner.

20. All-In Coverage: A type of condo insurance policy that covers the building’s structure and all interior elements, excluding the unit owner’s personal belongings.

21. Combined Single Limit: A type of liability coverage that provides a single limit of coverage for both bodily injury and property damage claims.

22. Multiple Deductible Option: An option that allows the unit owner to select different deductibles for various coverage types within the condo insurance policy.

23. Certificate of Insurance: A document provided to the unit owner by the insurance company, showing proof of condominium insurance coverage.

24. Loss Assessment Limit: The maximum amount the insurer will pay for unit assessment charges resulting from a covered loss.

25. Loss Assessment Deductible: The amount the unit owner is responsible for paying towards unit assessment charges before the insurance coverage applies.

Remember that condominium insurance policies may vary based on the condominium association’s master policy, state regulations, and specific coverage options chosen by the unit owner. Always review your condominium insurance policy documents carefully to understand the details of your coverage.