Problems with my condo insurance?

Question

There was some water damange to a condo my parents own from the floor upstairs. We called our insurance company and it feels like we're running around in circles. The insurance company wants the "Standard Unit Definition" basically a piece of paper stating what the condo will be responsible for, and what the insurance company is responsible for.

My condo claims they can't find the standard unit definition. That I should already have it when my parents bought the condo. Meanwhile the insurance company won't go forward with the claim, even though I've asked them to call the condo and figure it out themselves.

What should I do?

Answer 1

The insurance company is balking because you may not be responsible for the damage. Has the condo association filed a claim with their carrier?

Your condo association purchases insurance on the building and premises. Broadly speaking there are two approaches condo bylaws take to insure the property.

One approach is the condo association agrees to cover only the exterior and common areas. You are responsible to insure the interior this can include walls, wall coverings, flooring, furnace, appliances, lighting, plumbing fixtures, kitchen and bath cabinets (basically everything inside your condo). In this scenario you are responsible not only for your personal property but also the entire interior of your condo. As an insurance agent I did not like this approach because it is very difficult to determine how much insurance you should have to be able to repair or replace everything in within the walls of your condo.

The other approach, which I always preferred, was more comprehensive where the association agrees to cover the entire unit as it was originally built. In this scenario you only insure your upgrades (i.e. bookcases, upgrades, finished basements. etc.) and your personal property.

This is why your insurance company wants to know who is responsible for what. Some one has a copy off the bylaws your parents would have received a copy when they purchased their unit. The associations attorney would have a copy or check with the city assessor or check with the State as the bylaws have to be filed and approved.

When you get the claim straightened out. You need to carefully review those condo bylaws or have a good insurance agent go over the bylaws with you. I'm not sure how your parents knew what to insure when they bought their homeowners policy. They could be woefully under insured and perhaps unable to rebuild their condo.

Sorry for the long answer but it is a surprisingly complex question.

Answer 2

OK, if it's upgrades to YOUR condo, that you made, then you REALLY need to go under part a of your parent's policy.  Period.  

HOWEVER, likely they don't have very much coverage for part A  (building), or maybe none at all, which is why THEIR insurance company isn't doing anything.  They need to talk to their agent, and if they can't get a declination in writing, file a complaint to their state insurance commissioner.  See, THEIR coverage does NOT depend on the association coverage.  Saying, let's see what someone else will cover should have NO bearing on how THEIR claim is adjusted - it just gives a basis for recovery.  

In any case, absolutely, they got a copy of the bylaws when they bought the unit - however, for a small fee (copying price), the association should STILL be willing to give them another copy.    They need to have a lawyer friend write for a copy.  If the association can't produce proof that they are NOT responsible for the full damage, then your parents will likely win a suit against them.  Keep in mind, the ASSOCIATION  insurance policy probably isn't going to cover it - most likely they have a big, fat deductible, and the damages are under the deductible anyway - meaning the lawsuit will be paid, by an assessment to all the unit owners - including your parents.

Their agent should push the insurance company to either deny, or settle, the claim.  Period.  And if they won't, the state insurance commissioner will.