A fire in your building can be life-changing. If your unit was directly affected, you may be dealing with feelings of loss and trauma. Even if your unit is spared, you may still have to find somewhere else to live while the repairs take place – and that can take a very long time.

When your condo has been damaged by fire, the insurance is not always as straightforward as it is when a single-family home is affected. The process and the repairs can take longer to sort out.

As condo ownership becomes increasingly common, more and more people are wondering how condo insurance works. If there has been a fire in your building, you’re worried about your insurance, or you want to know how it works before you buy a unit, these are the broad strokes you should know about condo insurance.

What Your Fire Insurance Policy Covers

There are two primary expenses that your own condo fire insurance policy should cover: Contents and Additional Living Expenses. If you live in an area prone to wildfires, you may also want Mass Evacuation coverage.

Contents insurance covers your belongings, such as furniture, electronics, clothing, and valuables. Additional Living Expenses covers the cost of living elsewhere while repairs are completed.

There will be a deductible and coverage limits that could restrict how much you can receive. It helps to have an emergency fund to pay the deductible, even if you have insurance.

Your condo insurance should also cover any upgrades and improvements you have made to the unit at your own expense. Upgrades such as new kitchen appliances or flooring would not be covered by the condo board’s policy. You will have to talk to your insurer about getting this type of coverage.

Additionally, your condo insurance policy should cover personal liability. This coverage will pay if you are sued because someone injures themselves while in your condo or in case you, a guest, or a contractor causes damage that affects other units (such as starting a kitchen fire).

If you are renting the condo, you will want to take out your own renter’s insurance to protect your valuables and yourself from liability.

What the Condo Board’s Insurance Covers

The condo board’s insurance, which you help pay for through your condo fees, covers the costs of repairing or rebuilding the structure of the building, including common areas, stairways, elevators, the lobby, and the structure of the building.

As the unit owner, it’s important to know that you’ll have much less control over the process than the owner of a detached house would, as the insurer will be working with the condo board or corporation.

Be Prepared for Long Construction Times

Multi-unit buildings are much more complex than single-family homes when it comes to both insurance claims and construction times. You should expect the process to last at least a couple of years before you can move back in.

If you have the opportunity, you may want to double-check your coverage limits for Additional Living Expenses. Given the high cost of rent in many cities, you may want to ask about increasing coverage to ensure that you’re protected.

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