Insurance for condominium apartment owners: HO6 coverage

An HO6 policy protects your apartment and the belongings inside it. Find out what this coverage is and how to choose the one that suits your needs.

If your apartment is located in a condominium, you may have received a notification from the complex administration about the recent amendment to the Puerto Rico Condominium Law. Below, we have created a guide that will allow you to learn more about how this law impacts you and what you need to keep your property insured.

A brief explanation of the Puerto Rico Condominium Law

The recent amendment to the Puerto Rico Condominium Law, approved in August 2020, changed what was previously established, which stipulated that the council that owns the condominium in which you reside had to choose an insurance that would cover all the units, including their interiors.

However, with the updating of this law, it is now the owner’s responsibility to choose the insurance policy that will protect their assets. The most complete and necessary coverage for condominium residents is known in the market as the HO-6 condominium policy.

What is the HO-6 condominium policy?

The HO-6 policy covers property within the residence, including improvements made to the insured unit. The HO-6 provides protection in case of damage caused by fire, vandalism, earthquakes, or hurricanes (extended cover). Currently, each individual is responsible for managing their insurance and estimating the value of belongings within the residence.

There are several covers to choose from, and you should know that, with greater protection, the total cost of payment will increase. However, this is an investment that will allow you to have complete protection and avoid unexpected expenses in the future.

Types of coverage

• exclusive property
• personal property
• Improvements and/or alterations
• loss of use
• Personal responsibility
• Medical expenses
• Replacement cost of personal property
• Personal injuries

Details of types of coverage.

private property

Include the elements attached to the interior structure of your apartment that are named in the parent deed, including:

• Kitchen
• cabinets
• Built-in furniture
• toilet and sink
• Interior doors and floors
• Fixtures and interior walls
• Among others

personal property

Protects household items and personal property against accidental and covered loss or damage, including:

• Hall
• Dining room
• quarter games
• Household items
• Clothing
• Personal articles
• Among others
• Improvements and/or Alterations: You can purchase this optional coverage for an additional premium and insure the improvements or alterations you have made to your unit/apartment.
• Loss of use: protects up to 50% of the coverage in unexpected expenses due to damage insured in your policy, in case you are not allowed to stay in your unit. This includes rental expenses if your property is uninhabitable.
• Personal liability: If an accident occurs on your property that causes damage to third parties, this policy will cover legal liability and expenses in accordance with the limit established therein.
• Medical expenses: in the event that third parties have medical expenses for injuries to third parties, this policy will reimburse them.

Additional covers to maximize protection:

• Replacement cost of personal property (contents): with this optional coverage, you will be able to replace your belongings without the depreciation of the years affecting your policy.
• Personal Injury: (Personal Injury): optional coverage in the event of false arrest or false imprisonment; libel or defamation, invasion of privacy. The insured limit will be the one you have chosen for the personal liability cover.

Who needs an HO-6 policy?

The owner of a condominium unit with a mortgage may be required to have HO-6 insurance coverage when renewing their condominium policy. If this is your case, your mortgage bank will send you a letter requesting information about your coverage, and if you are not protected, it will grant you a grace period of 14 days to choose the policy and company that suits your needs. On the other hand, if you do not have coverage at the end of the term, the bank will choose the company and policy for your property, and you will not be able to take advantage of the opportunity to choose the ideal coverage for you.

A POLICY IS RECOMMENDED EVEN IF YOUR UNIT IS ALREADY PAID

A policy is also recommended even if your unit is already paid off. This will allow you to protect your belongings in the event of an unexpected event. Since prior to the amendment of the Puerto Rico Condominium Law, it is likely that your condominium had a master policy that covered both the private and communal elements of the condominium. However, from the renewal of the insurance from August 2020 onwards, it is possible that you no longer have the coverage to insure your personal property. If you obtain HO6 coverage and have a loss covered by the insurance and it is eligible for payment, you will receive compensation in your name and that of the banking institution (if applicable).

Why choose USIC to insure my belongings?

Our company offers a long and solid track record of 30 years, providing excellent customer service, as well as the most competitive HO-6 policy in the market. In addition, we are the only insurance company in Puerto Rico evaluated and classified by AM Best with an excellent A rating for financial strength.

At USIC, we offer you a variety of covers to protect your belongings and options that fit your needs. If you want to request a quote for your property today, go here. If you still need more details to decide which cover will best protect your property, request more information here.