Everywhere you turn, you will see new residential construction. However, the construction occurring is no longer all single family houses, each with a white picket fence and a porch swing. In an effort to keep up with the concept that less is more, new construction now includes condominiums. The concept of a condo has been around for decades, and began as a great way to allow for home ownership and saving space in larger cities. However, it has spread to the suburbs as an opportunity for individuals to purchase rental properties or even downsize as their children move on with life. The difference between a condo and an apartment is that in condos, each unit is individually owned. Then, there is an association of individuals who help manage the common grounds and issues.

Who Is Responsible?

Condominiums have become desirable for people because of the minimal risk in comparison to single family homes. Certain large-ticket repairs are the responsibility of the condominium association as opposed to the unit owner. The unit owner is responsible for his or her own personal property, such as clothing, interior appliances, electronics, interior furniture, and interior fixtures. Furthermore, their homeowner’s insurance will cover any injuries that occur inside of their property. Repairs such as interior painting, interior door replacements, new carpets, and cabinets lay on the unit owners’ shoulders. And that is where their responsibility ends. Exterior issues, such as roof repair, broken windows, exterior door repairs, and even patio furniture issues, as well as holes in the walls, ceiling repairs, and bare floor issues or foundation problems are the responsibility of the homeowners’ association. Even issues appearing in common stairwells, elevators, or walkways must fall on the association’s shoulders. The association itself must maintain an insurance policy to cover damage to the exterior and common grounds of the entire property, this is more times than not, referred to as the Master Policy.

The Responsible Party

Since the condo association has a large portion of responsibility, there is often a board of directors for the association. These may be individuals paid by the unit owners or volunteers who want to ensure their properties are always safe and in great condition. Either way, this group is responsible for maintenance and repair of the exterior and common area. Sometimes issues may arise simply because people are fallible and make mistakes. Furthermore, when with the board is comprised of volunteers, oftentimes managing the association is only one of the many tasks they will handle. However, a typical condo association liability policy will not cover the errors or omissions of the people managing the association. A separate policy must be purchased to cover officers and directors. Additionally, another policy strictly for volunteers must be purchased to ensure all people involved in managing the association and property are covered in the event of any issues.

The Proper Coverage

Like most insurance-related issues, the proper coverage and the mandated coverage are not uniform from state to state. Each state has its own set of rules that may or may not be similar to another state’s. However, the goal should not be to do what is required, but to do what is the best practice. Insurance is not designed to keep you legal. It is designed to protect you. Therefore, a person can sue for perceived injury, whether you are required to have insurance coverage or not, and if they win, the money must come from somewhere. Therefore, do not rely on the state to tell you the amount of coverage you need and what must be covered. Rely on the facts. It is a fact that a person whose interior is damaged as the result of a faulty exterior issue will file a lawsuit to cover the damage to their property. A person who is financially wronged by another’s misrepresentation or omission will sue to recover losses. As a result, it is important to fully cover your condo association for any issues which may occur, no matter the likelihood, to protect your association from going bankrupt and folding, leaving the condominiums unable to sell.