If you’re considering purchasing a condominium in Panama City Beach as a second home or a vacation property there are some details and information you need to know about your homeowners insurance. Of course you want to ensure and protect your condominium or vacation home, but it’s slightly different than a permanent home. Here are some things you need to know about ensuring your vacation condo.
#1. Ask your current insurance provider if they offer a secondary home endorsement.
Many people automatically assume that they will need to buy a standalone home insurance policy in order to cover a vacation condo this is not necessarily the truth. Often times insurance companies will bundle you were permanent or primary residency with your temporary your vacation property, which is a very cost-effective way to go. These levels of endorsements and cost vary from company to company so it’s important to ask your agent and even shop around if necessary.
#2. Ask about increased liability coverage.
Because vacation homes and condominiums frequently have additional people over such as guests or even rentals, something could happen that you want insured. Vacation homes can be vacant for long periods of time and it can increase your liability risk. Ask about any increased liability coverage should you suffer a break-in while you’re not there were if one of your guests damages something on the property.
#3. Also, ask about insurance requirements that might be different based on your condo location.
Homeowners insurance policies may cover for a particular city or state that your primary residency is in but may not include your vacation condo if they are outside the area in which they cover. Some insurance companies may only be able to cover in state properties so you certainly don’t want to think you are covered when in fact you’re not because you are out of state from your primary residency.
#4. What does the condo policy cover.
A condominium policy is slightly different than a single-family home. The homeowners association has a all-inclusive, full coverage insurance policy that covers the building itself including the outside, the roof, the foundation, siding and maybe even windows and amenities. A condo homeowners insurance policy will cover all of your belongings and specific areas of the unit listed in the policy. If you are unsure about a particular area simply ask your insurance agent. Talk to your homeowners association and find out if certain items are covered by the Association or if they need to be covered by you personally. As a condominium owner you may have lower insurance costs because the homeowners association will ensure the exterior of the property and could even provide security.
#5. Try to find ways to save on your home insurance policy.
As we mentioned before, bundling policies including car and your primary home insurance policy may save you some money. Ways to save on your policy would be to install an alarm system that could give you anywhere from 10% to 35% off of your policy. Finally, make sure you shop around and get at least three quotes for coverage on your second home. It certainly pays to shop around and let them know that your shopping so they can offer you the very best deal possible.
#6. Insurance for renting out your property.
If you plan on renting your vacation condominium throughout the year your homeowners policy will likely increase and you may need to purchase additional coverage. This also depends on how often you read out the property and for how long. If you have multiple people in each month, the policy may be higher, which is a good thing because it can cover a variety of issues that may come up from multiple tenants. However, if you plan to regularly went out your second home you may need a separate business coverage or landlord policy if you are renting it out for primary monthly income.
#7. Fair rental income protection.
In addition to getting the coverage that you need if you plan on renting out the condo you want to contact your insurance provider to inquire about fair rental income protection. This covers loss such as a hailstorm, explosion, tsunami or hurricane and could help reimburse you for the lost revenue from not being able to rent it out due to an “act of God”.
#8. Insurance risks of a second condominium or home.
Before finalizing your purchase on a vacation condominium there are some insurance risks to be aware of. If there are long periods of vacancy this can be cause for concern. If a leak happens, a fire breaks out or burglary occurs you may not know it until the building burns down or you have some severe damage. Consider the location of your condo as well. Either several people in the building that can look out for each other? Is the building to secluded to get timely help from local first responders? Are you prepared to be liable for any injuries to tenants and visitors will damage to the property that they may cause?
Of course none of us want to have to deal with these hazards or disadvantages of owning a second condominium but they are things to consider and be aware of. Bottom line: make sure that you are well covered for any issues that may come up, either with yourself or tenants and visitors. Talk to the homeowners association about how other vacation condominiums are handled in the building and what protection the Association provides.
For more information contact our agents today. We be happy to send you a complete list of vacation condos in Panama City Beach or answer any other questions you have about purchasing a condo for homeowners insurance.