What's The Difference Between Condo and Home Insurance?

When buying a home, you might be deciding between a house versus a condominium.  Whatever your choice,  you know you’re going to spend money to insure your home and your possessions. 

But, did you know that there’s a difference between insurance for a condo vs. a house? Let’s examine both coverages, and see what these differences are.

What is home insurance?

There is a lot of money in your home, and your possessions. You don’t want any sudden damage to your property or suffer any loss or theft where you have to pay out of pocket. Home insurance helps to offset the cost of replacing or repairing any potential loss that you experience.

Home insurance can cover the following:

• coverage for loss and damages to your home and outbuildings
• loss and damages to your possessions
• possessions that are stolen from your vehicle
• injury or damage to others who visit your property
• accidental damage you cause to another’s property

Additionally, if there is damage to your home and you need to temporarily stay in a hotel or rental property, home insurance will cover this through additional living expenses.

Be aware: prices vary from provider to provider, and there are always add-ons that you can get above and beyond the basic home insurance.  Be sure to compare home insurance policies to find the best possible price, and make sure that you get the coverage that you require, such as earthquake protection and flood insurance. 

What is condo insurance?

Unlike home insurance that covers both the building and the contents within it, condo insurance insures your unit, your possessions in your unit and storage locker, as well as personal liability claims in case someone is injured in your space.

Condo insurance offers coverage for any loss or damage to: 

• Your personal belongings
• The inside of your condo unit
• Renovations made to your unit by yourself or previous owners
• Other units or common spaces (eg. Hallways, elevators) resulting from an accident within your unit
• Additional living expenses if you can’t stay in your unit due to an insurable loss

What condo insurance does not cover are any damage, loss, or injuries that happen to or within your condo structure. For instance, if there is a flood originating from the rooftop of the condo, and you need major repairs to the overall structure of the building, your individual insurance will not cover this. Instead, your building’s master insurance policy would come into effect. 

The building’s insurance policy covers the overall structure of the condo (or strata).  This includes both the interior and exterior property, including elevators, common areas, and parking garages.

You pay your condo building's insurance via your condo fees. So part of what you pay each month goes towards this for and ensuring policy is up-to-date.

TIP: It’s important to review both your individual unit’s condo insurance as well as your building’s insurance policy. You wouldn’t want to be caught in a situation where you believed something was covered, only to discover a hole in your policy.

If you already own or are considering purchasing a condo, it’s worth taking the time to join your condo’s board. This will allow you to have a voice when it comes to matters concerning things like your building’s insurance.

BE AWARE: Whether you live in a condo or apartment, if you run a home business, it’s your responsibility to notify your insurance provider. Home insurance typically doesn’t cover business-related claims, so you’ll probably need to purchase a separate business policy.

The difference between insurance for a condo vs. house

Home insurance covers you and your property, including liability, external structures, and everything within your home – appliances, furniture, and valuables. Condo insurance covers what’s in your unit, including your liability, contents, and your unit. Your condo building and common elements (e.g. hallways, elevators) are paid through your condo fees. 

What about a townhouse?

If you’re looking to purchase a townhouse, you might be asking yourself some specific questions. Is there a difference between townhouse vs. condo insurance?  Is townhome insurance the same as house insurance?

Townhouses can be either an individual house or a condo. 

If the townhouse is a condo or strata, you need condo insurance and you’ll be required to pay condo fees, there will be a condo board and a condo corporation behind it all.  

If it’s an individual home, then it acts as an independent unit and you'll need home insurance. So the type of insurance you purchase really depends on the building’s classification.  Nowadays, many new townhomes are sold as condos, so there will be a master policy in place.

When you’re looking at a townhouse insurance policy, there are specific things that the insurers will be looking at. They’ll want to know things like: 

• How many shared walls there are
• If there is a firewall separating the homes 
• Is the attic is shared or individual 

These will all affect the rate of insurance, just like there are many factors that affect your premiums when purchasing a house or condo.

If you’re looking to purchase a townhome, be sure to inquire if it’s classified as a condo or individual home, and speak to your insurance provider about what types of things can affect your premiums.

The bottom line

Whether you’re looking to purchase a house or condo or are searching for the best homeowner’s insurance, be sure to take the time to consider the specific factors of the property that could affect your premiums.  If you have recently purchased home insurance, or are looking to purchase a new home or condo, let us know about your experiences in the comments.