What Does a Condo Association Insurance Policy Cover?

Individual condo owners are typically responsible for maintaining their own HO-6 insurance policy, but the building itself is covered under a separate policy held by the condo association. Understanding what that policy includes and where it stops can help all parties make informed decisions about coverage.

What a Condo Association Policy Typically Covers

Condo association insurance, often called a master policy, is designed to financially protect the shared elements of the building and property. Coverage commonly includes:

• Common areas such as lobbies, hallways, elevators and parking structures
• The building’s exterior, including the roof, foundation and outer walls
• Shared amenities such as fitness centers, pools and community rooms
• Liability coverage for injuries that occur in common spaces

Different Types of Master Policies

Associations typically carry one of three policy structures. A “bare walls-in” policy covers the building structure up to the interior walls of each unit but excludes fixtures, flooring and appliances. An “all-in” or “all-inclusive” policy extends coverage to include those interior elements. A “single-entity” policy can provide a middle ground between the other two types, covering the building and original, built-in interior fixtures, but not improvements made by unit owners. Knowing the difference can help condo associations and residents avoid coverage gaps when selecting policies.

What the Association Policy Does Not Cover

The master policy does not cover a condo owner’s personal belongings, their unit’s interior upgrades or their personal liability. A separate condo owners policy, sometimes called an HO-6 policy, fills those gaps and may also cover residents’ shares of a special assessment if the association’s coverage falls short after a loss.

As for specific incidents, standard condo association policies typically exclude many of the same perils as other forms of property insurance. Floods, earthquakes, sewer backups and pest infestations typically require additional coverage, either through separate policies or endorsements.

Make Sure Your Coverage Fits Together

Unit owners’ personal policies and the association’s master policy should complement each other without major gaps. If you’re a condo owner wanting to discuss coverage, contact ISG Auto Insurance to review your condo insurance, assess your association’s master policy and address any possible issues.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.