Home > Learning Center > Understanding Condo Insurance: Liability Coverage

Understanding Condo Insurance: Liability Coverage

Find Your INSURAMATCH

Already have a quote? Retrieve it.

 | October 18, 2018
Condo Liability

Accidents happen. Even a friend or family member might file a lawsuit against you to cover their damages or medical costs if you are at-fault for an incident in your condo. Condo liability coverage helps protect your assets if a simple accident leads to serous lawsuits and expenses.

Let’s go over the specifics of condo liability coverage so you can make sure you are fully protected in the case of an unforeseen, expensive incident.

What is liability coverage?

Liability coverage helps protect you financially in the case of a lawsuit from someone injured on your property. It is typically part of a standard condo insurance policy.

Condo liability coverage helps cover medical expenses that you are court-ordered to pay due to an accident that occurs within your condo’s walls. For example, someone is in your condo (a friend or worker) and they trip on the rug. They break their wrist and have to go to the hospital. They could sue you for any medical expenses incurred from the accident in your home. If you are found at fault for the incident (in your home, you usually are found at fault), you will have to pay their bills.

Medical expenses can include the ambulance, ER, testing, imaging, treatment, physical therapy, and even pain and suffering. These medical bills can be a serious and long-lasting financial burden that you would likely have to pay out of pocket if you didn’t have condo liability insurance (or enough insurance coverage).

Condo liability coverage also helps cover property damage, protecting you if you cause damage to someone else’s property. For example, you’re at a friend’s house and you accidentally spill red wine on their $10,000 white carpet. Your condo insurance could help cover the property damage expenses if your friend sues you for the cost of the carpet.

In some cases, your condo liability might even cover pet-related damage. For example, if your dog bites someone, your liability coverage could step in to help pay for a lawsuit or medical expenses.

Your condo liability coverage may also help pay for any legal fees associated with the lawsuit itself. So if someone sues you for damages and you go to court, your condo insurance can help pay for a lawyer in addition to the payment awarded the plaintiff (up to your limits). 

Does my HOA’s master policy cover liability?

The condo association holds their own liability policy, but this is different from your policy. Their homeowners’ association policy will generally only cover liability in shared spaces. They would be responsible if someone is injured in common areas, like a hallway, clubhouse, or elevator. This is true even if the injured party is your guest, but they are damaged in a communal space.

You are otherwise responsible for any accidents that happen within the four walls of your condo. Any other incidents outside of your walls fall under the condo’s association master policy. That’s why condo insurance is often referred to as a “walls-in” policy.

Learn more about the difference of condo responsibility with our article, “Should I File A Claim With My Condo Insurance Or Association Master Policy?

Is liability coverage mandatory?

The law does not require condo insurance in general. However, your condo homeowners association may have minimum coverage requirements, especially for liability. If you have a mortgage on your condo, the bank or lender may often require an insurance policy as well.

Even though it’s not mandatory by law, condo insurance is just as important as homeowners’ insurance. You should strongly consider at least purchasing liability coverage to protect yourself from serious financial responsibility in the case of a series incident in your home.

Does liability insurance cover my belongings?

Liability insurance only covers someone else’s expenses for property damage or medical expenses. This coverage protects you in the case someone comes after you to pay their bills.

Condo liability insurance does not cover your personal property or the structure of your unit. To protect the belongings in your home, you’ll need to purchase condo personal property insurance.

Liability also does not cover your costs if you are displaced from your condo for whatever reason. This would fall under loss of use coverage.

What are the coverage limits for condo liability?

Most condo liability policies will include at least $100,000 in liability coverage. You can choose to purchase a higher limit, often up to $500,000. If you want more coverage, you can purchase a supplemental umbrella policy.

How much coverage do you need? You should select the liability coverage that would best protect your current assets. You don’t know how much someone’s potential medical bills or lawsuit could cost. Worst case scenario, they could sue you for everything you have. The more liability coverage you have, the lower your risk for paying exorbitant legal and medical costs.

Learn more about condo insurance here in the Learning Resource center.  

Bottom Line

You are responsible for any incidents that happen in the four walls of your condo. Protect yourself, your family, and your assets from serious financial burdens with an effective condo liability policy.

Find the right condo insurance for your home. Call an agent at (855) 244-7671 or request a free quote: