Insurance is one of those things people don’t like to think about until they need it. Even so, there’s no better feeling than having an insurance policy that you know will protect you if the worst happens. Given that many people don’t know how their personal insurance works, it’s no surprise that so many are in the dark about condo association insurance.
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What Is Condo Association Insurance?
Condo association insurance protects the general common areas of condos and similar buildings. These insurance policies offer provisions for the property and liability coverage too. It’s always good to get a “certificate of insurance” when you purchase a condo unit. This certificate outlines the policies currently in effect on the building and when they were implemented.
If you don’t already have an insurance agent on your side, then you should discuss policies with an agent to learn more about what each condominium association insurance policy covers. Understanding your policy eliminates any nasty surprises when something goes wrong, and it turns out your policy doesn’t cover what you thought after all.
What Is the Role of the Insurance Agent for a Condo Association?
The role of a condo Association insurance agent is similar to the role of any other insurance agent. Their main job is to promote and sell insurance policies And services to customers. Insurance agents have a general understanding of the market they serve and can give customers the advice and guidance they need To choose the best policy for them.
What Should I Look for When Choosing a Condo Association Insurance Agent?
There are several things to look for when choosing a condo association master insurance policy and an agent to go with it. Here are some of the most important considerations to make;
1. Experience with Other Massachusetts Condo Associations
It’s best to work with an agent who knows about condo associations. A qualified agent is one that has worked with other condo associations, including associations similar to the one you have. Their experience gives them a keen insight into the risks your association is likely to face. Understanding these risks enables agents to prepare for them and advise the right protective measures.
An extra benefit of this experience is that agents with experience with other condo associations have likely heard stories of how coverage plays out in real-world situations and scenarios. If you have any questions about the coverage, an experienced agent can probably offer an example to illustrate their point.
2. Knowledge of Condo Association Insurance Coverages
Good agents understand what is and aren’t covered in their condo association insurance policies. They know to speak clearly about the protections their policies offer and situations not usually covered by insurance. You may have to pay a bit extra to get coverage outside the norm.
There are several reasons that working with an agent who understands condo association policies is so important. The first benefit is that condo insurance tends to be different from standard insurance policies. It takes specialist knowledge to understand specialist insurance. The second reason is that the coverage you choose will have a drastic impact on not just your condo association but on everyone who has a unit and lives on the property. It would be best to work with someone with experience when getting insurance, so many people besides yourself depend on in an emergency.
3. Familiarity with Other Insurance Policies
As well as knowing the ins and outs of condominium association insurance, your chosen agent should have some understanding of other kinds of insurance. Look for an agent that also offers;
- Commercial Umbrella Insurance – could be needed if you want extra coverage
- Directors and Officers Insurance – could be needed to protect board members against liability lawsuits
- Commercial Auto insurance – could be needed if you have company vehicles
If you decide to purchase these insurance policies, it would be best to get everything using a single agent. Having everything covered by the same agent is more convenient for you. It also makes it easier for you to review your policies to find duplicate coverages and gaps in your coverage you should address.
4. Independent of Insurance Companies
The best way to ensure that you get all of the above is to work with an independent insurance agent. The word “independent” refers to insurance agents that don’t work for specific insurance agencies. The term distinguishes these agents from the “captive” insurance agents that do work for specific policies.
The reason you should avoid captive agents is simple; these agents are only able to provide policies underwritten by the insurance company they work for. On the other hand, an independent agent can freely recommend any relevant condo insurance policy that would be a good fit for your association, no matter the insurer offering the policy.
5. Natural disasters can’t always be prevented
You might be tempted to save on insurance by not covering certain things, such as natural disasters. While it’s true that you can take steps to protect against natural disasters, there is no way to completely disaster-proof your condominium. There is no way to prevent natural disasters.
It’s worth investing in insurance against any natural disasters that are likely to affect your condominium. Your insurance policy should protect you against all the issues you are likely to face. It’s better to be safe than sorry when it comes to insurance, particularly with something so potentially damaging as natural disasters.
6. Malpractice is a serious concern
Not all insurance agents are created equal. Malpractice is an issue with the insurance industry that you can’t afford to ignore. This isn’t to say that every agent is looking to rip you off, but some are more unscrupulous than others. Look into the history of an agency before buying their policies. See if you can find online reviews and testimonials.
Treat insurance like any other product or commodity. How often do you read online reviews before buying something like a computer? Insurance should be treated the same way. There are too many people not getting the payout they deserve for the issue to be ignored.
7. You’re responsible for your employees
Your condo association insurance policy will cover many things, but it won’t cover your employees. You are the one responsible for taking care of them and protecting against the mistakes they make. You may be able to get the insurance that covers what your employees do, but you should expect to pay more for that.
Take proper precautions and use due diligence when hiring people. You don’t need to worry about your employees when you trust them to do a good job and be responsible.
8. Customers are unpredictable
The only people more unpredictable than your staff will be your customers. One of the realities of owning property rented out to others, including condos, is that tenants often behave in ways you’d never expect. Insurance policies generally protect you against damage done from outside sources, but the elements aren’t the only risk to your condo.
Consider investing in insurance that protects against tenants’ damage or taking out a separate insurance policy to protect your condo as much as possible.
9. People besides you drive company vehicles
As mentioned before, you should consider auto insurance on your company car – if you have one. Keep in mind that you aren’t the only one who drives your company vehicles. Auto insurance is based on the driver of the car. If you include vehicle coverage in your condo association insurance, make sure that you get the right degree of coverage. You wouldn’t want to foot the bill because an employee was driving the car when they weren’t covered.
10. Annually review all your policies for gaps and coverage
Taking out an insurance policy is just the beginning. It would help if you checked the policy at least once per year. You could find gaps in your coverage that need to be plugged. Perhaps you don’t realize how much coverage you need until you take out your policy.
Another reason to check your policies annually is to check for duplicate coverage. You could be insured for the same thing twice through different policies. There’s no sense in paying for two insurance policies when you only need one. Reviewing your policies lets you plug gaps and remove duplicate coverage, saving you money, and improving your protection in one go.
You should never hesitate to ask insurance providers questions about their coverage and policies. Ask potential agents how many associations they’ve worked within the past, how well their insurance policies, and what levels of coverage they offer. Don’t forget to ask them if they are independent or not. When you find an insurance provider who gives you the answers you’re looking for, you’ve found an agent that offers what you need.