The financial perils of buying a condo

That’s going to be the interesting question. Maybe the insurance payouts come from liability if the HOA is sued for negligence? I tend to agree with you though - if they knew about the problems and then just squabbled about them, I doubt anything like dwelling/structural insurance pays out.

They’d probably not get insurance

I don’t believe that having a building condemned itself is covered by insurance.
Failing to maintain your home is not covered by insurance.

But if some insured failure happened which lead to the payment, then you might get insurance payment. I don’t think buildings are usually condemened out of the blue for no reason just for looking shaby and being old. I dunno, but I’d assume theres often some kind of event that triggers it.

The HOAs insurance may not pay. But a condo owners should - it’s really no different than a tree falling on your house. The condo didn’t collapse, the building around it did.

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yeah I wasn’t sure if we wer talking about the condo that collapsed in Florida or a more generic question about condos being condemned due to lack of maintenance.

Except most condo policies do not include dwelling coverage aside from any fixtures that you own outright in your unit. The HOA master policy covers stuff like the structure because that’s the entity that’s at risk of loss. The HOA almost always owns the common areas, with unit owners as fractional owners of the HOA entity as a whole. What you want is loss assessment coverage - which covers you if the HOA is forced to charge an assessment that results from a loss to a common element that is not covered by their insurance. I had this coverage in my condo and I am glad I did.

Any potential condo owner needs to read up on HO6 insurance and understand what endorsements/additional coverages are necessary to truly protect your investment.

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And to come full circle,

About $33 million from the land sale is planned to be paid to individual owners of the 136-unit condo. Owners will also receive another $50 million in insurance coverage from the building.

Last week, relatives of victims and survivors of the collapse reached a preliminary $997 million settlement with 20 defendants in the case, with most of the money going to the relatives. Unit owners have requested a higher settlement amount than they initially were given.

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Is it likely they’re going to get enough to make them whole?