Whether a first-time home buyer or downsizing from a house, millions of Canadians are choosing the convenient and often more affordable condo-style living. Many chose their condominium because of its worry-free lifestyle devoid of common concerns such as leaky roofs, onerous lawn maintenance and fluctuating utility bills. However, in choosing this carefree option, many people can forget to prepare for potential issues that can, and often do, arise. When purchasing a house, insurance is always one of the first considerations addressed before taking possession. Unfortunately, insurance is frequently overlooked by condo owners since most people are unsure of the type of insurance coverage they need and what they should be protecting. According to research conducted by RSA Canada, most consumers don’t understand potential gaps in their condo insurance. The majority of condo buyers generally assume they need contents coverage. They also look for low premiums and liability coverage, however they are not always aware of the gaps in what they do and do not own, and consequently don’t understand what they need to insure. Many people don’t know if there have been upgrades to their unit if they aren’t the original owners and therefore they don’t know the consequences of something as simple as painting the walls. Unless the owner has included betterments and improvements in their policy, they will not be covered for water damage if their new paint leaks and damages the floors. Many Canadians also do not understand the concept of “assessment” and that they can be held financially responsible for “common areas” if repairs are required. Before making a purchase, it’s worth enquiring what type of insurance the condo corporation which you are looking to become a part of has in place. In most cases, condo owners are responsible for insuring any improvements within their unit, as well as contents such as furniture, clothes and electronics. However, as mentioned, each circumstance can vary depending on the condo corporation’s insurance package and the specifics of your unit and building. Asking your realtor, lawyer or property manager key questions before you purchase a condominium will help determine how much protection you have under your condo corporation’s insurance policy, and ultimately help you determine insurance coverage you need to purchase. Some key questions to ask include: 1. What does the condo corporation’s insurance cover and, more importantly, what doesn’t it cover? a) Does the corporation’s policy cover just the structure and common areas of your building or complex, or more? (e.g. damage to your unit’s walls) 2. What is the deductible in the corporation’s insurance policy? 3. If there is major damage to your building, is it possible that you would have to make an additional contribution to cover the deductible of the condo corporation’s insurance policy? 4. Are you responsible for the full cost or repairs to another condo, or the full deductible on the corporation’s policy if, for instance, your dishwasher leaked or your bathtub overflowed and damaged the unit below? 5. How is a “standard unit” defined by your condo corporation? Does it cover things like fixtures, ceilings and floors? Research shows people are also concerned about water damage and specifically who is at fault. For example, if a unit has faulty caulking around the bathtub and water leaks into the unit below, who is responsible to pay for the damages? The answer to these questions varies by situation, so to avoid any distress and unnecessary financial burden, speak with an insurance broker who can help determine your insurance needs. Canadians often seek advice from family, friends or the Internet; however, when it comes to insurance it is really important to speak with a professional with knowledge and insight. The bottom line is: if you are thinking about buying a condo or already live in one, consider your insurance needs carefully and talk to your local insurance broker. To find a broker who can explain the common types of condo insurance and what is right for you, visit the Broker Locator section at www.rsagroup.ca.