My condo is the same. Seems very standard, i'm sure you could lower it with a higher premium? in theory, hopefully you never need to pony up the $5000 dollars, but it doesn't seem unreasonable?

First, the "value of your unit" is of no consequence. It is the cost to rebuild it. The insurance is not desgned to purshase your unit, but to build back to the way it was.  
 
It is not uncommon for associations to increase the associations deductibles. This is especially true if the association has been hit with a lot of claims and are seeing pressure from the carrier to increase the deductible. Typically it is from water damage claims. In most states, the association's insurance must respond to a water damage claim without any rights of recovery when the unit owner was negligent in the cause of the water damage (broken laundry hose, hot water heater exploded, etc).  
 
You can look to mitigate this higher deductible by purchasing building coverage on your HO-6 policy along with loss assessment coverage.

Yes, a $5K deductible is actually quite usual, and do check your HO6 coverage since in most cases it can be tailored to cover some of the deductible.

There are associations who budget insurance deductibles as one of their reserve accounts so they have the money available should they need it.  
 
Last year our deductible went from $1,000 per building per incident to $5,000. We have two buildings, so we would have to cough up $10,000 for major damage to both. 
 
Recently I had damage to my condo door on the corridor side. Someone put glue in both of my locks (dead bolt and door knob lock. I live in a security building and the occupants are all adults.) I had to replace my locks and make duplicate keys ($60.) I submitted this to the board for reimbursement because I thought the association covered the deductible and that the vandalism happened in the hallway (which is a common element and that they were responsible for the maintenance of the common elements.) They denied my request and said the door inside and out is owned by me and thus my responsibility. 
 
I called my condo insurance agent to see how private and master association policies mesh even though I knew my private deductible was $250. I was told that my deductible had no relevance because doors are "structure" and my personal policy only covers contents (anything you can take with you.) "Master association policies cover structure." I asked what if I had some kind of structural damage solely to the inside of my unit and no one else's and it came to $5,000. I was told neither policy would cover that.  

Can someone tell me where in the master policy it would state that the homeowners were responsible for the deductible - or is it a by-laws/rules and regs item. I don't see it in either place but may not be looking under the right heading. Thanks so much.

We had major water damage from my unit (fresh water hose popped off toilet) and flooded my unit and three units below us had major to moderate damage. The deductible on the master condo insurance policy was $25,000 and our share of that deductible was prorated based on the estimated damage to each unit. In my case we had over 50% of damages so our share of the deductible was quite high, which reduced our payments from the master condo insurance policy holder. However, our homeowners insurance company paid us for this amount minus our homeowners deductible, which was $500. So in the end it worked out fairly well.

Exactly why condo owners should carry a policy to protect them against a high deductible charged by the association. Condo insurance in general is cheap and less than $20 a month.

Are there personal condo insurance polices that include STRUCTURE and contents? Mine does not include structure.

You should have an automatic $1,000 building coverage with a basic H)-6. But you can increase this. Ask for Building coverage (building coverage would include anything that is permantly attached to the walls).

There is a lot of inaccurate information being given to some of you by your insurance agents who have written your HO-6 policies. What is and is not covered by your HO-6 policy depends on what your association's bylaws state is the association's responsibility and what is your responsiblity, including some structural components, such as doors, windows, patios, decks and other items that service only your unit, which would include your electrical lines inside your walls, your plumbing lines inside your walls, your vents (all types), etc. In addition, it is typical for associations to require owners to carry a minimum amount of HO-6 coverage equal to the association's deductible and if they do not carry such insurance, then the owner has to pay the entire amount of the deductible out of their own pocket. When it comes to replacing structural damage in catastrophic losses such as hurricane, fire, tornado, etc., master association policies are only responsible for repairing or rebuilding the unit to the same level of finish that the original builder sold it in. In other words, the association will not replace your hardwood floors that you installed last year nor the new cherry cabinets and new granite countertops that you installed during a recent kitchen renovation. It will only pay to install standard builder grade carpet, standard builder grade cabinets and countertops, etc. If you finished your basement after you moved in and it was not done by the original builder prior to being sold to the first owner, the master policy will not pay to have your finished basement replaced. All these improvements are called "betterments and improvements" and the replacement value of these items should be added to your HO-6 if you want them covered in the event of major damage to your unit. Sorry to rain on your parade. Nellie, you especially need some additional advice from someone who knows what they are talking about!

Great public service info Judy. It took me months to get the Board to give me the information/Master Policy to see what we needed in terms of gaps. Now we have a new policy and I am having trouble getting a copy of this new one for my agent to review. You'd think they'd want us to be insured correctly. I've been asking for about 6 weeks and was told no problem, then suddenly they have to get permission from the agent to give to me. Come on!! It sends red flags in every direction. Again. The only way to get this is to hire an attorney even though legally we should be given this information.  
 

Don't know what state you are in Mary, but you might want to search online for "condominium laws (or statues or revised codes) in XXXX" and see if you can find if your state has laws governing condominiums, associations, condominium owners, etc. The owners ARE the association and as such have the right to see any record of the association that does not violate someone's privacy. There's no reason that you shouldn't be able to get a copy of the master insurance policy. If it is large, they have the right to ask you to pay for copies. Also, if you haven't already, please put your request in writing and keep a copy! If they don't give you a copy after you request it in writing and offer to pay for copying it, I'd contact your state's Department of Insurance and file a complaint against both the association and against the insurance agent/carrier if you can find out their name. I bet you get a copy of the master policy then!

While I concur with much of what Judy stated, you must always refer to state law (which varies) and also to what the documents require the association to purchase. It is all to often that when quoting the insurance for an association and a property manager will say, we only need "bare walls coverage" (this is essentially only building it back to bare sheet rock, subflooring and no cabinets, sinks, fixtures, etc) and it is quite different. Often the association is responsible for insuring common elements and building coverage in the individual units. Look in your bylaws for the insurance requirement section. Reading the actual policy is really not going to help you unless you can truly understand an insurance policy (I have been reading them fo 15 years and still scratch my head at times). 
 
There are 4 typical coverages available. Some are not allowed in certain states. 
 
The most common is "original specs" or "single entity" This is what Judy has described above.  
 
Next most common is "bare walls". The associations policy is responsible for rebuilding back to bare sheet rock and subflooring. Floor covering, cabinets, fixtures, paint.  
 
High End Condos often have "all-in" coverage which requires the association to purchase coverage for all improvements and betterments. This is rarely seen and would require an appraisal of interior as well as exterior. 
 
Finally some rental resort condos have a requirement where the association must cover EVERYTHING including furnishings. There are some comlex issues related to this coverage and anyone that is involved with this type of association knows it and hopefully is dealing with an agent that has experience in writing this type of policy. 
 
 
 
All that being said.... "What do the condo documents require?" 
 
That should be your basis of coverage. Everyone should still be covering their tails with at least $15K of building coverage regardless and $25K of loss assessment coverage. For pennies a day, why chance it.

Thanks Judy. Missouri. I have the ByLaws, Indentures and Statues practically memorized at this point. The law doesn't seem to matter. I just sent my insurance agent your paragraph above after I read it. He has watched us go thru this last summer only to have them change again in December. He just emailed me the same - file a complaint with the Div of Insurance here. If I don't have it this week I will deal with it on Monday. Have to pull all the backup from last year and write it up with a copy of all the requests to date. WIll let you know what happens.  

To Clarify - bare walls excludes paint, fixtures, cabinets, flooring.

Someone PLEASE help me. I bought my condo in Dec06 and in Feb08 a pipe within my bathroom walls burst (water froze) and flooded my condo. The condo association rebuilt the walls and my insurance covered my personal property. The line burst again in Feb 11 and now the association sent me a letter stating that they will no longer be responsible for filing a claim under the condominium policy  
 
because "I should know the outside wall has had several freeze and breaks. I have not known this and was not made aware of this when I purchased the condo. I was also told that I will be responsible for the $2500.00 deductible for damage done to other units if the line breaks again. Can someone explain 
 
to me what my rights are at this point. Do they have the right to change the policy and should I have been informed of the "several" breaks prior to purchasing the condo by the association. Also do I need an attorney at this point.

To follow-up on my post above on January 28, after talking to my agent, I surprisingly received a policy revision in the mail lowering my loss assessment coverage from $10,000 to $5,000. I had not requested this, so I wrote to ask why. "First, your loss assessment coverage was lowered to $5000, because that is your new assoc deductible amount. Your loss assessment coverage would cover 
that master policy deductible." I then emailed back and said our master policy has a deductible of $5,000 per building per incident, and we have two buildings. The response was: "I would assume that the association would only charge you the 
deductible for the building you live in, but that might be something you want to ask them and if we need to we can increase the loss assessment back up to $10,000, we can do that. 
 
I had asked her if my personal condo policy had structure coverage, and she replied: "I looked at the townhome policy and you don't have building coverage currently. It is something you should probably add to your policy. If you add $20,000 in building property coverage it would add an additional $45/year in premium, and you would be covered for building additions or alterations, 
and any building property that is excluded from the assoc master policy." I emailed and asked if I could just get $5,000 in structural coverage. She answered: "The building coverage can be any amount you think you'd need. As far as covering the assoc. deductible, that would be under your loss assessment coverage, not under your building coverage. So you need to pick a dollar amount for building coverage, based on what your association doesn't cover. Most of our townhouse owners start with around $20,000 in building coverage. Sometimes the assoc. has a recommendation for that coverage amount too, based on what their policy does or doesn't cover." 
 
One thing I learned this year was that I had sewer/drain coverage for about $44 a year and had had this for 15 years. I thought it was for if your plumbing sprung a leak and went down into the unit below (I am on second floor.) No, I was told that would be covered by another part of the policy. Sewer / drain coverage was for if your sewer backed up. I asked how often does a sewer back up to a second floor? Rarely, apparently. Conclusion: I had paid for this coverage for years and have now dropped it. Dumb me. 
 
 
 

Ask to see that loss assessment coverage endorsement. There may be a limitation of $1,000 to covera deductible. Loss assessment has many other uses (including funding an assessment for a liability claim that goes above and beyond the association limits). Buy at least $25,000 it should cost about $20.

Rick, loss assessment - that confuses me. Can you give me an example of a liability claim that goes above and beyond the association limits? And in that dollar-amount example, how much would each owner have to pay in a 32-unit association?

Association has $1MM limit. Claim comes in at $1.75MM The association must come up with $75MM. They assess the unit owners because they hav eno other way of getting the funds. That is a $23,000 assessment that you can turn in to your insurance company.

Strike the last scenario. 
 
Try these numbers.  
 
$1MM Limit. Settles at $1,750,000. 
 
$23,000 assessment to each owner.

Yikes! This is scary stuff! In other words, when my agent said $5,000 worth of loss assessment was enough, she wasn't thinking about loss assessment in terms of liability issues. Besides covering a deductible, and a liability issue, does loss assessment include some other concept?

Thanks Ron for your explanation of the 4 types of coverage, bare wall, original specs, etc. I've spent a lot of time over the past several year being "taught" by an insurance agent who specializes in condominium master policies. But, I'm sure that what he's taught me has either applied directly to my communities or to the law in Ohio. So, now, you've taught me something too! I'm glad you added the loss assessment coverage in your comments. It never crossed my mind when I was putting in my 2 cents, but is very valuable info. Also, would you talk a little about the various types of water intrusion into a unit and how the insurance industry is currently handling (or not) each. My simplified recommendation to new owners has always been, call your agent and tell them that no matter where it comes from or how it gets into your unit, that you want water intrusion and damage covered . . . to add whatever riders are necessary to your policy to make sure that it's covered. However, you and I both know that the insurance company has continued to chip away at what types of water damage claims that they are willing to cover over the last few years. I also want to caution all readers with basements about this. ASK if there are any units in your building that have sump pumps!! Don't ASSUME that because your unit doesn't that none do and don't let ANY insurance agent tell you that since your unit doesn't have a sump pump that you don't need coverage for water damage due to a sump pump failure!!!! Not true!! I manage a community with buildings that have 4, 5, 6, and 8 unit buildings. Some buildings only have 1 sump pump, some have 2, some have 3. It all depended on the elevation of the building on the site, etc. Four or five years ago, we ran into the above situation. A sump pump failed. Three basements suffered fairly extensive water damage and only 2 of the owners had the proper coverage. The third was a young girl, but her father was fit to be tied because he had done business with this particular insurance company for years and was ready to choke his agent!! The master policy did kick in on this claim, after the $5,000 deductible. But, unlike the other 2 owners who were only responsible for their own deductible under their HO-6, this girl had to foot her entire portion of the $5,000 since her HO-6 insurance didn't cover anything! Don't be afraid to ask your agent "what if" questions about what's covered and what is not covered. If they don't want to answer them, refuse to answer them, seem annoyed . . . . RUN as fast as you can to another agent!!

Thanks so much again to Judy for a wealth of information. The more I read and learn - the more incredible it is to me that our new company that sold us the master policy won't give me a copy to verify what gap insurance I might need. After six nice requests and stalls on their side I finally emailed the agent yesterday and told them we will from this point forward hold them personally liable for any and all damage that might occur going forward to our unit that is not covered properly since we have been unable to get a copy to determine what we might be missing. HIring an attorney will get us nothing but more bills. My agent said yesterday to contact the Division of Insurance in Missouri - but most articles say they don't do anything. Any suggestions are welcomed Thanks.

Judy and all, I just got an email from the new agent holding our Master Policy. It's above an email that the Property Manager sent to him. Give her the information she wants and "I hope this ends it".  
 
I just can't believe that they have done all they could to prevent us from getting a copy of the policy to review it to see if we have any gaps.  
 
Has anyone else had this problem?  
 
PPM is the property manager in Missouri - does anyone else use them?

Getting a copy of an insurance policy shouldn't be a big deal, especially in todays world with electronic media. If you were to ask for a paper copy, it requires a lot of time and resources to copy it. Unless you are going to do a full review of the coverages, exclsuions, endorsements, and enhancements, there really is no need to waste of that paper and everyone's time. Ask for a certificate if you are interested in knowing the limits of coverage. 
 
What do you expect to find in the policy??? I think you are wasting a lot of valuable time searching for something that you would not understand if you are not an agent or a lawyer.

Maryann, "I hope this ends it." What kind of attitude is that for a PM and an insurance agent?! YOU are a paying customer through your monthly assessments - I think they have forgotten that. In Minnesota the Department of Commerce handles complaints including insurance. Maybe your state has something similar. I once requested a copy of our master policy, and it was sent to me by State Farm without any problem. The reading was tough going, but there were just a few sections I was interested in, so it went ok. Recently I was told by my personal insurance agent that my condo policy was not available online.

I know. It's been an uphill battle to get anything done here and that makes you wonder what is "really" going on. Transparency is so important today. I will check to see about the Department of Commerce in Missouri. I have been slowly but diligently putting together the proper back up for a complaint. I was a paralegal for years so have the understanding to do it properly.  
 

Is a master plan insurance policy cheater or higher for a Townhouse versus a condomimium complex?

Condo/homeowners ins. vs. condo assoc. master ins. policy: Are unit owners legally allowed to make 2 claims.....for instance, one claim on personal property damage to their homeowners, and the other claim on building damage due to hot water heater bursting to the condo assoc? We pay premiums and fees to both. Also, why should the homeowner's private insurance have the right to communicate with the management co. of the association? What should we never sign to avoid subrogation? My homeowners policy from SF assured me the amount on bld. damages (low), was ok, because of the condo assoc. insurance. Neither insurane co. is working for us....we're just the suckers paying them to have a job. What else is new?

I am in a similar situation to Nellie right now. I own a basement unit and a common pipe cracked along the second floor causing mold damage and water damage. My personal insurance picked up the mold remediation ($3.5K) and is giving me another $1k after my $500 deductible. They are then telling me that the other $5k is the master policy's responsibility. Well, we have a clause that they owners have to pay for the master policy deductible. This pipe has destroyed one whole wall, my ceiling, a significant amount of tile, my vanity, my light, and my sink. The adjuster from the master policy hasn't called or contacted me about this and we're trying to rebuild asap as we're down to studs and this whole ordeal has been doing on for weeks. Did my personal insurance technically pay the master's deductible? What do I do now? Any and all help is greatly appreciated as I'm going to rebuild next week and seek legal advice.

Our hot water heater burst in July. 
 
My claim through homeowners pol. was settled for building damage (flooring & baseboard); and contents...some furniture and clothing to be cleaned. $500.00 came from contents coverage; building cov, was lower, as I was advised condo assoc.'s insurer covered building damage. Property Manager is playing here's a little info; for you; "I'll keep the rest." Does condo law in any state require the homeowner to divulge numbers? My agent said no. After all, it is my policy. Would homeowner be contacted in case of subrogation? Prop Man. is not an ins. agent...