Fire and Rental Property
The three most common types of Fire or Rental insurance are:
Renters Insurance
Condo Insurance
Dwelling (Rental Property) Insurance
Renters insurance provides financial protection against the loss or destruction of your possessions when you rent a house or apartment. While your landlord may be sympathetic to a burglary you have experienced or a fire caused by your iron, destruction or loss of your possessions is not usually covered by your landlord's insurance. Because in most cases, renters insurance covers only the value of your belongings, not the physical building, the premium is relatively inexpensive.
By purchasing renters insurance, your possessions are covered against losses from fire or smoke, lightning, vandalism, theft, explosion, windstorm and water damage (not including floods). Like homeowners insurance, renters insurance also covers your responsibility to other people injured at your home or elsewhere by you, a family member or your pet and pays legal defense costs if you are taken to court.
Renters insurance covers your additional living expenses if you are unable to live in your apartment because of a fire or other covered peril. Most policies will reimburse you the difference between your additional living expenses and your normal living expenses but still may set limits as to the amount they will pay.
There are two types of renters insurance policies you may purchase:
Actual Cash Value – pays to replace your home or possessions minus a deduction for depreciation up to the limit of your policy
Replacement Cost – pays the actual cost of replacing your home or possessions (no deduction for depreciation) up to the limit of your policy
With either policy, you may want to consider purchasing a floater. A standard renters policy offers only limited coverage for items such as jewelry, silver, furs, etc. If you own property that exceeds these limits, it is recommended that you supplement your policy with a floater. A floater is a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy such as accidental loss.
Condo Insurance
If you have purchased a condo, the bank will require insurance to protect its investment in your home. You may, however, need more insurance to cover your personal items, liability or fees that may be charged to you regarding shared areas of the building like the lobby.
You will need two separate policies to protect your investment:
Your own insurance policy.
This provides coverage for your personal possessions, structural improvements to your apartment and additional living expenses if you are the victim of fire, theft or other disaster listed in your policy. This policy will also includes liability protection.
A "master policy" provided by the condominium association board.
This covers the common areas you share with others in your building like the roof, basement, elevator, boiler and walkways for both liability and physical damage.
To adequately insure your apartment, it is important to know which structural parts of your home are covered by the condo/co-op association and which are not. You can do this by reading your association's by-laws and/or proprietary lease. If you have questions, talk to your condominium association, insurance professional or family attorney.
Sometimes the association is responsible for insuring the individual condominium or co-op units, as they were originally built, including standard fixtures. The individual owner, in this case, is only responsible for alterations to the original structure of the apartment, like remodeling the kitchen or bathtub. Sometimes this includes not only improvements you make, but also those made by previous owners.
In other situations, the condo/co-op association is responsible for insuring only the bare walls, floor and ceiling. The owner must insure kitchen cabinets, built-in appliances, plumbing, wiring, bathroom fixtures etc.
Also, ask about the following additional coverages:
Unit assessment
This reimburses you for your share of an assessment charged to all unit owners as a result of a covered loss. For instance, if there is a fire in the lobby, all the unit owners are charged the cost of repairing the loss.
Water back-up
This insures your property for damage by the back-up of sewers or drains. Water back-up may not always be included in a policy. Check to see that it is included.
Umbrella liability
This is an inexpensive way to get more liability protection and broader coverage than is included in a standard condo/co-op policy.
Flood or earthquake
If you live in an area prone to these disasters, you will need to purchase separate flood and earthquake policies.
Floater or endorsement
If you own expensive jewelry, furs or collectibles, you might consider getting additional coverage since there is generally a $1,000 to $2,000 limit for theft of jewelry on a standard policy.
When purchasing insurance, it is important to find an agent or company that specializes in condominiums or co-ops. Also don't forget to ask about all available discounts. You can reduce your rates by raising your deductibles and by installing a smoke and fire alarm system that rings at an outside service. If you insure your unit with the same company that underwrites your building's insurance policy, you might also get an additional reduction in premiums.
Dwelling (Fire) Insurance
The dwelling policy provides property (building only) coverage for the dwelling owned and occupied, or rented to others. The dwelling must be used for residential purposes only. The Dwelling policy can also be used to insure a dwelling under construction.
Basic coverages
Dwelling- for the amount of coverage you select
Premises Liability- liability protection for the dwelling premises only
Optional Coverages
Other Structures -other buildings located at the dwelling premises.
Personal Property -personal property kept at the dwelling premises.
Medical Payments - paid to others for medical expenses
Fair Rental Value- in the event that a loss prevents rental of the dwelling and loss of rent
Please contact your agent for more information.