Condo Insurance

Why it is a necessity

Just like if you bought a single-family home and need to buy homeowners insurance, it’s important to have condo insurance aka HO-6 insurance. When you buy a condo, you don’t own the building or the land, but you do own your unit. It’s important that you get your unit and belongings insured as soon as possible so that you are protected from sudden and unexpected costly events.

With housing prices continuing to rise all over the US, buying a condominium might be more feasible than buying a single-family home. Have you taken the plunge and bought a condo recently? According to Community Associations Institute, about 25-27% of U.S. citizens are living in community associations (homeowner’s associations, condo communities, etc.). Out of that, around 35-40% account for condominium communities.

Condo insurance covers everything, from your unit’s walls and flooring to your possessions. Most people think this policy is the same as homeowners insurance, but it has a few differences.

In this article

Condo Insurance vs. Homeowners Insurance

When you buy a home, you are purchasing the building, fences, garage, and a yard. You’ll be responsible for all of them and your belongings as well. Your homeowners insurance includes all of your property.

When you own a condo, you don’t own the building. You only own the unit you live in, which also includes the unit’s outermost walls. Your condo home insurance will cover your property and your unit, but nothing else.

For example, imagine a fire breaks out in your backyard and destroys your garden. Since you do not own the backyard, a condo association, or homeowners association (HOA) will take care of the expenses through their master policy on the building. Whereas, ff this same situation was to occur in a single-family home,  homeowners insurance would take care of the expenses.

The master policy is more commonly known as HOA insurance. While your condo insurance coverage takes care of everything in your unit, a master policy covers everything outside of it. It includes the stairs, walls, amenities, and covers injuries and losses to guests in common areas. For example, if any of your guests slips and falls into the swimming pool and fractures their leg, HOA insurance will cover their medical payments and expenses.

There are two types of master policies:

  • Bare walls-in: Covers the structure of the condo walls like the wiring, framing, and the walls themselves.
  • All-in: It covers everything that came built-in with your condo walls, such as, fixtures, sinks, built-in bookshelf, etc.

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What Does Condo Insurance Cover?

Although your HOA insurance may cover all the property outside of your unit, it is not enough. More often than not, your HOA will require you to get condo insurance and you’ll also need it if you’re looking to get a mortgage.

Condo owners insurance is not a luxury, but a necessity. Let’s look at what HO-6 insurance covers:

Interior Walls:   

Your condo insurance covers your dwelling’s interior walls. We suggest you know which kind of master policy you HOA provides before deciding on your condo insurance. If your HOA provides an all-in master policy, you won’t need a condo dwelling coverage. However, if your HOA provides only bare walls-in coverage, then you will benefit from dwelling coverage. Condo insurance covers your dwelling and belongings from all named perils. Suppose your condo catches fire and damages your walls and built-in shelves. Your condo dwelling coverage will pay for the repairs.

Liability and Medical Bills:  

You are likely to entertain guests in your new condo. Unfortunately, a guest trips on your carpet, and falls headfirst into a glass table, and suffers injuries. Even though most of these injuries may be minor, sometimes people can still suffer trauma to the spine or back. For both injuries, liability and medical bills will cover a certain amount of the medical bills. Furthermore, if the guest decides to sue you, your insurance will cover your expenses to a certain amount.

how much does condo insurance cost

 Personal Property:

Personal property coverage will cover your belongings such as appliances, furniture, jewelry, art collection, expensive collectibles and other possessions from perils such as theft and hailstorm damages. Suppose your condo was broken into, and the robbers stole your fur collection and china dishes. Your personal property coverage will either pay you back the cash value or replace your stolen goods.

Loss of use and Additional Living Expenses:  

If your unit suffers damage due to named perils, additional living expenses coverage will cover the cost for your hotel bills. Suppose, a massive hailstorm occurs and smashes your windows and the electricity has been shut down. The building needs some repairs, and you are now temporarily homeless. You may need to stay at a hotel until your condo is fit to live in again. In this case, your condo insurance will cover your hotel bills.

what does condo insurance cover

Available Endorsements in Condo Insurance

Sometimes your standard condo insurance policy may not be tailored exactly the way you want it. You may need to protect your jewelry collection for $10,000, but the insurance you are tied to may only cover it for $5,000. You’re able to get additional coverage on your collection for theft through a rider, or an endorsement. You’ll be able to get your preferred coverage for an additional cost.  

Let your trusted insurance agent build you a customized condo insurance policy that you need. 

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    What does condo insurance exclude? 

    Even the broadest forms of insurance have a set of exclusions. Condo insurance is no different. Here are some of the exclusions you can expect to see when you purchase condo insurance:

    • Earthquakes, landslides, mudslides, flooding, and volcanic activities 
    • Water damage due to surface water, tidal waves, tsunami, etc. 
    • Ordinance of law 
    • War 
    • Nuclear hazard 
    • Power failure 
    • Intentional loss 

    Are you ready to keep your belongings and your condo insured against all odds? Here’s a list of our partners that can help you find the right policies for you. 

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