We bought a brand new townhouse from a developer. It is a small complex with 2 townhouses (single bulding, sharing wall) and a detached single home. They are all in the same condominium which was built 6 months ago. Because this is brand new, we had to form our own association and decide who will be officers like president, treasurer, etc and it did not have HOA hazard insurance. The other 2 units are bought using cash and only our unit was purchased through mortgage.
My mortgage company changed and now they are asking to provide HOA hazard insurance. We only have homeowner insurance. Questions:
- Is homeowner insurance different from HOA hazard insurance? In my research, I think in townhouse setting, homeowner insurance only covers what is inside my unit whereas HOA hazard insurance covers shared structure such as exterior walls and roof. is this correct?
- If homeowner insurance is different from HOA hazard insurance and I am required to buy one, do I have to purchase HOA hazard insurance as part of our HOA entity and convince the other 2 unit owners to pay their share? Or if they refuse, do I have to pay for the other 2 units' share of premium or can I just pay for my share? What happens when we do need to make insurance claim due to say roof damage in this case?
- My mortgage company estimated if they were to buy the insurance for us, we would be charged $6500 annual premium which feels very expensive compare to my homeowner insurance ($800 premium with 500k dwelling coverage, 360k personals property, etc). I called my insurance agent and they don't do HOA insurance and when we called state farm agent we know of, he doesn't deal with it either. Is there a good website where we can compare premiums?