As warm weather months and fun on the lake continue, make sure your clients’ water-based condos or apartments are insured.
Summer is having its last hurrah, and, for some, that means one thing: lake season. And while summer fun continues, insuring lake residents' dockominiums is one of many items on a cluttered to-do list.
For the uninitiated, a dockominium is a water-based condo or apartment. They can be a part of a marina or standalone. They may have originally been built to be a livable space, but often they are converted boat slips. These can be a great option when clients are looking for an affordable waterfront option for a home, vacation home or, in the home-sharing era, revenue stream.
Sometimes, dockominium insurance is called different things, such as marina insurance or dock and pier coverage. However, the one thing that can be agreed upon is that whatever you call it, insurance is 100% necessary to cover the owner's investment in the property and other liabilities.
Insuring a dockominium is similar to insuring a condo. The dockominium owner doesn't usually own the marina, just the portion of the marina where the dockominium is moored. Coverage typically covers the dockominium itself, its contents and liability for anyone who is injured on the property.
Property coverage may or may not apply depending on the type of dockominium. Some can just be a boat slip, others can have apartments or condos built on top of it. If the latter is the case, then the insured needs building coverage and must be insured against wind, hail and the event that it is sunk in a storm.
For dockominiums, deductibles are also important to consider. There will often be two deductibles: one for wind or hail and another for other covered losses, such as liability claims and contents damage. Depending on how the condominium is being used—whether it's a secondary home, rental home or a permanent home—the contents coverage limit must be sufficient to cover everything an insured permanently keeps inside, such as clothing, furniture and electronics.
When it comes to insuring dockominiums, liability insurance is particularly crucial. Whether it's a standalone dockominium or part of a marina, it's easy for an accident to happen. Trips and falls are common. Liability will pay for property damage or bodily injury that your insured may be responsible for or which occurred on their property.
For example, if someone injures themselves on the dockominium, the liability would pay medical bills and legal defense of a lawsuit. In Oklahoma, the lowest liability limits our agency typically recommends is $300,000. Although, depending on the type of boat and other toys, it is smart to protect insureds with higher limits.
Avery Moore is director of business development at ECI Insurance in Piedmont, Oklahoma.