When you reside in a condo that is part of an HOA, you pay the running assessments fee for amenities and certain services. However, there are times when some circumstances arise that your homeowner’s association (HOA) won’t be able to cover the cost of repair or damages. Before this happens, getting loss assessment coverage is crucial if you have a condo and are part of a homeowners association.
What Is A Loss Assessment?
Loss assessment coverage is the bridge between a homeowners association and the individual condo owner’s insurance policy. It protects condo owners against liability connected to a common area loss. In addition, loss assessment coverage will ensure you do not have to pay out of pocket for area damage.
What Is Loss Assessment Coverage?
If you are a member homeowners’ association, you share things like a pool, a courtyard, a backyard, a lobby, or an elevator with the other members. Loss assessment coverage covers the following:
- The HOA’s deductible costs
- Damage to shared amenities and spaces
- Costs for damages or injuries sustained on HOA property
However, a loss assessment will not cover things like:
- Costs of maintenance for an individual condo
- Costs of a condo building or property demolition/foreclosure
- Damages from natural disasters, like floods, earthquakes, or windstorms
How Much Loss Assessment Coverage Do You Need?
You will need to read your condo association insurance policy and review the coverage limits to calculate the loss assessment coverage you need. In general, a local insurance agent can help you estimate how much coverage is right for you.