The devastation from fire is irreversible. The reality of a total loss of all earthy belongings is unimaginable and the loss of life for people or pets is traumatic and tragic—for some it is unbearable.
Even worse news comes when the renter or the homeowner in a condominium association, apartment or planned-unit development with attached walls learns there is no insurance for their contents.
In most cases, when a homebuyer hears the HOA dues pays for fire insurance, the assumption is that is enough. Little thought is given to the need for insurance on the contents inside the walls. The insurance industry has initiated a program called “HO6” or “Walls-In” where buyers are required to carry insurance on contents but there is no assurance the policy stays in place.
The real estate industry, which includes property management companies, managers and HOA’s, must take on an extra layer of responsibility and advise buyers and renters of the wisdom and necessity of purchasing insurance on their possessions. The cost for contents of a normal dwelling unit is surprisingly affordable.
In a recent fire in a multi-unit complex where all contents were destroyed in two of the units, all four families were shocked to learn the fire insurance included in their HOA dues was of no benefit to them, but only to the lender carrying the mortgage.
Not only is the family without a place to stay, they have to continue making the house payment and replace every necessity for daily living … shoes, jackets, blankets, towels, computer, hair brushes, cell phones, all identification, dishes and medications. It feels overwhelming.
When there is adequate fire insurance coverage, there is money for lodging, mortgage payments and replacement of some items. The burden of picking up the pieces and moving to normal living is minimized, but the enormous burden of no coverage is almost too much to bear.
Let’s remind anyone who rents or pays dues to an HOA which carries fire insurance on the buildings, that fire insurance on the contents does not exist and must be purchased separately.
This is not a lesson that we want anyone to learn too late.
Kay Wilson-Bolton has been a real estate broker in West Ventura County since 1976.