Normally you are covered under your homeowners insurance which provides coverage for your home and surrounding area. And when you own the house property with other owners or say a condo which belongs to an HOA, then you might need loss assessment coverage that is used to share the loss of some common spaces on the HOA property, with the other owners.
As your home insurance policy or condo insurance only covers up the loss up to a certain extent. Thus, arising a need for loss assessment coverage.
What is Loss Assessment Coverage?
Loss Assessment Coverage definition can be explained as a type of coverage available in HO-6 homeowners insurance policies which is also known as condo insurance
So, it is the extra protection that is provided to your condo insurance, only when your HOA insurance policy limits are exceeded. Although, your condo insurance policy already has a Loss assessment coverage amounting up to $ 1,000.
What is Loss Assessment in Condo Insurance?
The condo owners are provided protection for situations when there is damage to the property up to a certain Loss Assessment Coverage limit. And when the certain limit is exceeded then condominium Loss Assessment comes into the picture.
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What is covered by loss assessment coverage?
All that which is covered in your HO6 policy or say regular condo insurance including your home structure, personal property, and liability damages all of which is covered by Loss Assessment Coverage insurance. So, condo Loss Assessment Coverage covers up named perils that include the following:
- Fire or lightning
- Windstorm or hail
- Falling of objects
- Weight of ice, snow, or sleet
- Accidental expulsion or runoff of water or the steam
- Abrupt and accidental tearing or cracking or burning or bulging
- Sudden and accidental damage due to short-circuiting
- Volcanic Eruption
How to buy Loss Assessment Coverage condo?
You can buy Loss assessment coverage from the home insurance providers. They also offer supplemental Loss Assessment Coverage or an optional coverage to be provided with the insurance policy at some additional cost.
Loss Assessment Coverage example
A person is injured in a tragic accident at the neighborhood of the society premises, and the lawsuit finds the HOA liable and thus awards the appellant $ 1.5 million. Although, The HOA’s liability policy limit is $ 1 million. So, the difference of $ 500,000 will be covered up by the homeowners and this will depend upon the number of houses in the society or the neighbourhood.
Loss Assessment deductible
Condominium Loss Assessment Coverage also protects you or provides you coverage against Loss Assessment deductible on your HOA’s master policy with other coverages such as shared property, the exterior of buildings damaged, some common area injuries, etc. So, here the Loss assessment coverage pays for the deductible portion.
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What is Loss Assessment Charge?
The Loss Assessment Charge is the amount which is due to be paid to the homeowners association, and this due amount is contributed by the owners or condominium or co-op due to property damage.
Loss Assessment Coverage Provided by:
Some companies do provide the Loss Assessment Coverage condo insurance while offering homeowners insurance policy, to pay for the loss assessment, which is as follows:
- loss assessment coverage Allstate
- loss assessment coverage progressive
- loss assessment coverage travelers
- loss assessment coverage State farms
- loss assessment coverage Farmers
- loss assessment coverage Nationwide
Earthquake Loss Assessment Coverage
earthquake Loss Assessment insurance pays off certain assessments that owners association charge from its members as earthquake-damage repairs. Thus, you can purchase earthquake Loss Assessment Coverage alone or with other coverages. Here, the Coverage Limit is up to $ 100,000 which is available in limits of $ 25,000, $ 50,000, $ 75,000 or $ 100,000. And the Deductible preferences range from 5 percent to 25 percent of the Loss Assessment coverage limit.
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You can buy Loss assessment coverage with your homeowners’ insurance policy as an add on insurance or with your condo insurance policy. As, the Loss assessment coverage provides you a small amount of coverage for assessments, or expenses when your condo exceeds your HOA insurance policy limits.
Frequently Asked Questions
What is Loss Assessment Coverage on a homeowners policy?
Loss Assessment Coverage meaning covers insurance for condo owners to provide protection for various situations when the condominium or co-op is financially responsible to contribute to deductibles or damage.
What maximum is there for loss assessment?
The loss assessment coverage is mentioned as well as covered up in your condo insurance policy specifying the coverage limit of up to $1,000, where you also have an option to increase the loss assessment coverage limit.
What is the Loss Assessment deductible?
Condominium Loss Assessment Coverage also protects you or provides you coverage against Loss Assessment deductible on your HOA’s master policy. Where the Loss assessment coverage pays for the deductible portion.
What is Loss Assessment Charge?
The Loss Assessment Charge is the amount which is due to be paid to the Loss Assessment Coverage homeowners association, and this due amount is contributed by the owners or condominium or co-op due to property damage.
Is loss assessment coverage subject to the deductible?
Yes, loss assessment coverage is subjected to the deductible. As it covers insurance for condo owners to provide protection for various situations when the condominium or co-op is financially responsible to contribute to deductibles or damage.
What is covered under Loss of use?
The loss of use covers up additional living expenses that exceed the normally spent expenses. As in the case of Loss Assessment Coverage, the sum or amount paid by the owners will be treated as loss of use.