Townhouse Insurance
Your townhouse is a house, just like the name implies, but insuring a town home is a bit different than insuring a stand-alone house. Town home insurance is much like condo insurance; except in the case of condominium ownership, you are responsible for property only from the 'walls in'. In the case of a townhouse, you actually own and are responsible for the ground under your condo and maybe the outside of the structure as well.
Townhouse Association insurance isn't enough
Your townhouse association has a master insurance policy that covers damage to building structures and amenities; master policies also provide liability insurance protection for injuries that may happen in common areas. However, town home association insurance coverages stops where at your unit walls. Sometimes there is no association insurance coverage for building structures at all.
Insurance coverage for your possessions
If you do have a townhouse homeowner association, the association policy policy provides no protection for your personal property like clothing, dishes and furnishings. And even though a standard condo unit owners policy does provide insurance coverage for loss to your possessions, there are limitations that depend on the type of loss (theft vs. flood, for instance) as well as on the type of property (computer records vs. computers, jewelry, art or antiques, e.g.). In most cases, standard condo policies can be amended, or endorsed, to provide the right coverage for your individual needs.
Contact us to learn more about your townhouse insurance needs or get a quote
Anatomy of a townhouse owners insurance policy
A standard condo policy is written on a coverage form known as an HO-6 and consists of five parts:
Coverage A provides coverage for property attached that is part of your unit - like flooring and cabinetry - but also the outside walls. The amount of this coverage can be increased if necessary and probably should be reviewed anytime you have make any improvements to your unit.
Coverage B is the insurance that applies to detached buildings like storage sheds. A nominal amount of coverage is usually included but this amount can be increased as necessary.
Coverage C is the policy part that insures your personal property. This coverage can be on an actual cash value (ACV or depreciated) basis or could be provided on a replacement cost basis. And as mentioned above, there are differences in the perils insured against as well as limits to reimbursed amounts by property type.
Coverage D is usually called 'loss of use'. If you condo is damaged by a covered peril, and is rendered unlivable for a period of time, this coverage will pick up reasonable expenses for you to maintain your standard of living while your townhouse is being repaired.
Coverage E is the liability coverage portion of the policy. This coverage part protects you if someone injuries themselves while visiting your town home. It also include liability protection for property damage on and away from your residence. Liability coverage protects your future earnings and current assets so you might think of it as a component of your asset preservation strategy. Typical coverage amounts for Coverage E are $100,000 or $300,000.
Coverage F is referred to as 'medical payments' coverage. This is a type of 'no-fault' coverage and reimburses guests for medical expenses if they are injured while visiting you at your townhouse. Typical medical payments coverage starts at $1,000 but can be increased for a small additional insurance premium.
Other insurance protection you may need
There are a few significant exclusions or limitations in a standard townhouse owners insurance policy that you should be aware of. We list a few for you here and suggest we talk about them when working up some comparison quotes for you:
Flood is not covered in a standard townhouse insurance policy but can be provided through an separate and affordable flood insurance policy.
Business pursuits coverage is provided but it is very limited. Endorsements can be added to your condo insurance policy and affordable stand-alone insurance policies, designed specially for home business, can also be a good option in some cases.
Loss assessment coverage is for assessments distributed to all unit owners in your complex by your condo association. These assessments are usually to recoup the insurance deductible that has to be paid by your association if there is an insurance claim. $1,000 is a standard coverage amount by higher coverage can be purchased. Whether or not you will need to do that will depend on the deductible that is part of your association's master insurance policy.
Contact us to learn more about your condo insurance needs or get a quote