Are You Covered? Homeowner vs. Building Insurance

Every right-thinking homeowner knows that carrying the proper insurance is a vital part of owning a home. For most people, buying a home is the biggest financial investment they will ever make—especially in today’s high-priced market, and especially in New York City, home to some of the most expensive property in the world.

In condo and co-op buildings, there are two different types of insurance policies at play—building insurance, and homeowner’s insurance. It’s vital that owners and shareholders know what is covered by their building’s policy versus what they are individually responsible for.

Unfortunately, many homeowners “Don’t give insurance a second look,” says Barbara Strauss, executive vice president of York International Agency, Inc. in Yonkers. “That’s why you have to call a broker who understands the working of condos and co-ops.”

New Risks, New Challenges

And that understanding has changed—or rather, new risks and liabilities have emerged that have necessitated a deeper, more comprehensive understanding of coverage and policy on the part of both insurer and consumer, whether the “consumer” is an independent apartment owner or an entire building.

The events of 9/11 put some questions to the insurance industry that had never needed asking before—such as, what are the insurance ramifications of total building destruction? Whose insurer is responsible if everything is gone—both the building structure itself and the contents? After 9/11, some insurers began offering “terrorism policies,” while others backed out of the business of insuring whole buildings entirely.

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