As our parents get older and more frail, they’re going to be moving from their homes in the suburbs into smaller abodes, often closer to things old people care about, like hospitals and proximity to aging parents. Condos offer other advantages too for those entering their golden years, including less space to clean, a lack of stairs for old, aching joints, and the ability for retirees to leave their condos safe for long periods of time while they go to warmer climates for the winter. Plus, selling a paid off property is a terrific way to free up some capital that can then be invested for income.
Condos are also increasingly chosen by younger buyers as a way to get into a rapidly increasing real estate market. In hot markets like Toronto, Vancouver, or Calgary, often houses are out of a single person’s price range. Condos are more affordable, and their size is better suited to someone living alone or a young couple without kids.
There’s little wonder why condos are a popular option these days, and builders are racing to meet that demand. Toronto alone will have over 60,000 units hit the market over the next few years. That’s a huge number, and it’ll likely mean a whole bunch of baby boomer families will be downsizing over the next decade, assuming their adult kids ever move out of their basement.
If you’re one of many people who either already own a condo or you’re looking to buy on in the near future, you’re likely going to want to do so in the cheapest way possible. Today, let’s focus on finding the most affordable condo insurance.
Part of your condo fee includes insurance on the condo’s common areas – things like the common room, the pool or gym, and so on – because technically the condo owner owns a little chunk of all of those areas. It’s why every owner has a right to use them, and why they pay a fee every month for that right. That insurance is mandated by your condo association, (the people owners elect to run the condo complex) so all you have to buy is insurance on your individual unit and your contents.
The good news is condo insurance is typically much cheaper than the equivalent insurance for a house, since most of the building is protected by the blanket policy. But still, you’re going to want to do a few things to save a few bucks.
Shopping around is important. Certain companies specialize in condo insurance, while others just offer it because they feel they have to, so different companies will have different rates. The internet is a great tool for shopping around, but make sure you talk to an insurance broker as well. They know tips and tricks that’ll get you a better rate.
Increasing your deductible is also a great way to decrease your premiums. If you know you’ll only make a claim because of a catastrophic event – like a fire or a flood – then it makes sense to increase your deductible to something like $5,000. If you’ve got a decent amount of cash in the bank, then all you really want to insure against is losing everything. If someone breaks in and takes your TV, it might just be simpler to shell out for a new TV.
An easy way to save 10% or so on your insurance is to pay your whole premium at once, when it comes due. Yeah, you’ll probably have to accumulate a little bit of cash to make this happen, but a guaranteed return of 10% yearly is nothing to sneeze at. I’d take advantage of that all day long, and so should you.
And finally, when it comes to renew your policy, take a few minutes and make sure you’re still getting a decent deal. I know car insurance and condo insurance aren’t the same thing, but I saved 30% on my car insurance by switching companies. Perhaps a savings of $10 or $20 a year wouldn’t make a switch worthwhile, but saving hundreds sure might give you the impetus needed to make a change.
Who knows, perhaps you’ll find yourself in a condo at some point. Hopefully now that you’ve read this, you’ll save some cash on condo insurance.