Condominium coverage can be confusing—and the FC&S staff receives myriad questions regarding condominiums and how to insure them. We recently received this inquiry regarding how a condo owner might cover the mortgagee's interest in the condo.
I am struggling with how to properly cover the mortgagee's interest under a Condominium Unit-Owners' policy.
When a Homeowners' policy is issued to a homeowner or either a BOP or Commercial Property policy is issued to a commercial-building owner, the Coverage A or the building limit reflects the cost to rebuild the structure—which in most cases would also be sufficient to cover the mortgagee's interest in the property, less the cost of the land and subject to co-insurance and other policy provisions.
Is it appropriate to draw a similar parallel to Condominium Unit-Owners' policies?
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