An Independent Insurance Broker Covers You Best.

Most condo owners believe that because their dwelling is insured under the master condo corporation insurance policy, that all they need to insure are their clothes and furniture. This cannot be further from the truth.

Every condominium corporation has their own set of by-laws and within these by-laws is a definition of the standard unit. As such the definition of the "Boundaries of the Residential Unit" can vary significantly. This definition outlines what is the responsibility of the condo corporation when rebuilding your condo in the event of a serious claim/loss. Everything outside of the condo corporation's responsibility is the financial responsibility of the unit owner — and is referred to as your "Unit Improvements/Betterments.

"The boundaries of the residential unit may only include the upper surfaces of the concrete floor, the lower surface of the concrete ceiling and the backside of the drywall on the walls. This means in the event of a serious claim, the condo corporation insurance policy will only rebuild the "basic shell" of your condo unit. Therefore, you are financially responsible for replacing the hardwood/ceramic or carpet flooring, you are responsible for the drywall, you are even financially responsible for rebuilding the entire kitchen. Some policies even exclude all of the plumbing and electrical wiring!

This applies to both high-rise condominiums and townhouse condominiums.

For you to properly insure your condominium - in addition to insuring your personal belongings - you must have enough "Unit Improvements/Betterments" coverage to actually rebuild part of the condominium structure.

You should obtain a copy of your "Condo Corporation By-Laws — "Schedule C: Standard  Unit Fixtures and Finishes" to determine the exact definition of what portion of your condo unit is covered by the condo master policy. Your insurance broker would gladly review this document with you.

Plus, condo corporations are now even increasing their policy deductible to lower their insurance premium — thus possibly passing on additional financial exposures to the unit owners. You must determine what amount of the condo corporation's master insurance policy deductible your personal insurance policy will cover. Not every policy is the same.

Therefore, when looking for your condominium insurance policy, you should make sure you discuss with your broker the amount of contents coverage you require, the amount of unit improvements/betterments coverage is recommended and how much of the condo corporation's policy deductible would be covered by your own policy.

Do not wait for a claim to find out your insurance policy does not adequately protect you — call your broker today and discuss your policy.