o The master policy provides coverage for the structures and common areas against risks of direct physical loss commonly insured against. The policy has a deductible like a homeowners policy in an amount typically chosen by the Association. In certain instances, a deductible for a specific type of claim (such as wind damage) may be required by the insurer. The deductible expense for a claim is a common expense of the Association. The policyholder should discuss deductible options and requirements with the insurer or insurance producer (agent). The master policy provides protection for damage resulting from covered perils to the basic structure of your unit. This includes the walls, floors and fixtures that were included in the original construction of the unit including carpeting and kitchen cabinets. The master policy also provides liability coverage to protect the Association against legal liability for injury to others or damage to the property of others, as a result of a covered occurrence. This coverage requires the insurance company to pay the attorney costs to defend the Association and the indemnity cost for the damages of the injured party up to the policy’s limit, subject to the policy’s terms and conditions.
o The unit owner’s policy is purchased by the unit owner and provides coverage for their contents and personal belongings, additions, alterations and betterments, liability coverage and additional living expenses following a covered loss. The policy may also provide coverage, subject to certain terms and monetary limits, for a unit owner’s share of a common area claim if it exceeds the master policy limits or is less than the master policy’s deductible. This coverage is known as loss assessment coverage. Consult with your insurance company or agent to determine how much loss assessment coverage is included with your policy and whether or not you wish to purchase more.
200 St. Paul Place, Suite 2700, Baltimore, MD 21202
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