Community Insurance – does it cover you ….
Do I need a private home insurance policy if my Community already has one?
Yes, they are completely unrelated. One will provide cover for your home and contents and the other provides covers for your community. We would strongly recommend that you take out your own private house insurance to cover at a minimum your home contents. The communal policy is geared normally to cover almost exclusively communal areas and facilities. Its purpose is not to cover the contents of your private home within a Community of Owners. Very rarely will the communal policy cover an accident in your own home and it will only be indirectly at best i.e. water-related damages originating in communal areas, such as a badly sealed gutter in the roof top, that results in water seeping through. By the same token you can also be held liable if your own home causes a flood that extends to adjacent neighbouring properties i.e. split internal pipes. This is not covered by communal insurance and you will have to pay for all related damages and repairs. Statements such as “there is no need to have a private home insurance if your community already has an insurance policy in place” are misleading and unfounded. If you want to be correctly covered and insured you should have your own private home insurance policy.
What does a Community policy normally cover?
This is a general question to which there is no specific answer. The correct reply is “it depends”. There is a broad range of policies available in the market with different price ranges. The difference in price is explained because the more expensive ones cover more accidents. So basically a community will tailor its insurance according to its own needs and circumstances. For example, it may not make much sense for a Community of Owners located in Marbella to pay a premium for additional cover against falling airplanes. However, this would make perfect sense in a Community that’s in the vicinity of a busy airport. So the bottom line is, you get what you pay for. There is no general communal policy acting like a blueprint to match one and all Community of Owners. It’s left at the discretion of the Communities’ governing body to ensure what events require cover.
You own a property and the community has insurance. So why do you need private home insurance? Your community insurance covers the building, commonly owned property, and the liability insurance doesn’t it?
When you buy a property you will be paying towards what is known as community insurance. You can’t choose not to pay this because it will be part of your community fees. Your community insurance policy doesn’t cover losses to your property as a result of a burglary, if water damage ruins your living room walls, or if someone slips on your wet kitchen floor and is injured.
Part of the community fee goes towards what is known as the community buildings insurance. Under Spanish law each community/urbanization (Comunidad) has to have a minimum amount of insurance to cover buildings insurance, public liability insurance and insurance against water damage.
It is obviously important that the complex is insured. The community insurance in general covers the outside or external part of the building. For example imagine if a fire breaks out in an apartment which destroys the whole block or part of it – the community insurance covers the costs to rebuild the apartment block. The public liability is also very important because in a large building accidents can and do happen. This insurance protects against legal action by third-parties. For example imagine that a visitor slips in the corridor and wants to sue or file a lawsuit – the community insurance will cover all the residents of the community (apartment). The community water damage insurance covers the community pipes which of course run all through the building. If one of these pipes burst then any damage will be covered by the community policy.
What you should know is what you are NOT insured and covered for. Do not assume your community fee which in turn covers the community buildings insurance is covering you for everything and that additional insurance is not necessary. As far as the common parts of the urbanization or Community of Owners are concerned, the Owners Association will have arranged an insurance that will cover the communal areas. Although such insurance might cover privately owned portions of the building, under no circumstances will it cover your contents.
Please note the information provided in is of general interest only and is not to be construed or intended as substitute for professional legal advice.