Reworking Condo Insurance for Attached Units: Transitioning to More Affordable Coverage for Small Unit Condos

Self-managing a small condominium regime can be challenging, especially when it comes to managing rising insurance costs. Many condo owners in small unit regimes struggle with the complexities of a condo master insurance policy that may not fit the way the property is used and maintained. If you have received an insurance renewal and were floored by the rate increase, you are not alone. I get many calls from condo owners wondering if they have options to change their condo insurance to something more affordable and better suited to the property. The answer is yes - we can help with the insurance rate increase sticker shock by drafting an amendment to your Declaration of Condominium Regime, which will allow a switch from a condo master insurance policy to individual single-family attached or townhome insurance policies. This change often improves coverage and reduces costs.

Two Unit Condominium Regimes may have separate insurance policies

Why Condo Insurance Rates Are Increasing for Small Regimes

Condo insurance rates have been rising steadily in recent years. Broad coverage under condo master policies may not reflect the actual risk for small, self-managed condo regimes. A condo master insurance policy covers all units under a single insurance plan. While this sounds convenient, it can lead to higher premiums because the policy is designed for larger complexes with shared common areas and amenities. Small unit regimes, such as duplexes, triplexes and four-plexes, may end up paying for coverage they don’t need and bear the burden of insurance companies recouping costs for claims at larger projects.

How an Amendment Can Help You Change Your Insurance

Amendments to the Declarations for Condominium Regimes allow condo unit owners to modify the original requirements set out in the Declaration. By recording an amendment, you can:

• Change insurance requirements to allow individual unit owners to carry their own single-family attached or townhome insurance policies.

• Eliminate or reduce the need for a condo master policy that covers both units collectively.

• Tailor coverage to the specific needs of each unit, potentially increasing protection while lowering overall costs.

• Reduce or eliminate monthly HOA dues.

  
  

This approach is especially effective for self-managed two-unit and small unit condo regimes where owners want more control over their insurance and expenses.

Benefits of Switching to Single Family Attached or Townhome Insurance Policies

Switching from a condo master policy to individual insurance policies offers several advantages:

• Cost savings: Individual policies often cost less than a combined master policy because they focus on the specific risks of each unit.

• Better coverage: Owners can choose policies that fit their unit’s unique features and contents.

• Simplified claims process: When damage occurs, individual owners handle their own claims, reducing disputes and delays.

  
  

We can help you quickly and affordably draft amendments to modify insurance so you may start saving on insurance for your condo unit.

Practical Tips for Managing Insurance After the Amendment

Once your declaration amendment is in place, keep these tips in mind:

• Shop around for insurance: Compare quotes from multiple insurers to find the best rates for your unit.

• Understand your coverage: Know what your policy covers, including dwelling, personal property, liability, and loss of use.

• Coordinate with your co-owners: Ensure all units have adequate coverage to avoid gaps and consider using the same insurance provider.

  
  

Condo Insurance Does Not Have to be Painfully Expensive

If you currently have a condo master insurance policy, you may be able to increase coverage and reduce insurance costs by changing to separate insurance policies on the units. We offer straight-forward assistance to help you make these changes smoothly, often costing much less than the price of one year's insurance increase. Reach out today to get started.