HO-6 Homeowners’ Insurance Policy: Coverages and Costs

Sharper Management

If you own a condominium, the condo association will most likely insure the building and shared facilities. However, if your things are stolen or destroyed in a fire, the association’s master policy will not assist you. A personal condo insurance policy, also known as HO-6 insurance, is required for these and other potential disasters.

What is an HO-6 Condo Insurance Policy?

An HO-6 policy is a sort of insurance that you can obtain if you own a condo. HO-6 insurance protects structural upgrades, personal belongings, personal liabilities, and condo owners association losses.

An HO-6 policy, often known as condo insurance, is a type of homeowners insurance for condo and co-op owners. An HO-6 coverage protects your personal possessions, your responsibility, and any modifications or alterations to the unit.

Your HO-6 policy should be in addition to the master policy of your condo association. Condo association policies vary, but they normally cover everything beyond the walls of each individual condo unit, including the condominium building itself, as well as responsibility costs if a guest is injured in a communal space. The amount of condo insurance you’ll require is directly connected to the sort of master policy in place at your building.

What Does HO-6 (Condo Insurance) Policy Cover?

A regular HO-6 condo insurance policy covers a variety of issues.

  • Interior damage to your unit
  • Improvements, additions, and alterations you’ve made to the interior of the unit
  • Personal property
  • Liability
  • Additional living expenses/loss of use
  • Loss assessment coverage

Consider purchasing additional personal property coverage for valuables such as jewelry, fine art, or high-end computer equipment.

We also recommend that you purchase supplemental liability coverage to protect yourself in the event that someone or their property is hurt while visiting and sues you for damages.

You may also require supplemental coverage for earthquakes, flooding, or windstorms, depending on where you live. Discuss your requirements with your insurance agent or firm to ensure you purchase the appropriate amount of coverage.

Perils covered by an HO6 Insurance Policy

Your personal property should be protected from the following risks under the general provisions of HO-6 condominium owner coverage:

  • Lightning or fire
  • Windstorm or hailstorm
  • Explosion
  • Riot or civil unrest?
  • Aircraft-caused damage
  • Vehicle-related damage
  • Smoke
  • Vandalism or intentional mischief
  • Theft
  • Volcanic eruptive activity
  • Objects that fall
  • Ice, snow, or sleet weight
  • Water or steam discharge or overflow from a plumbing, heating, air conditioning, or automatic fire-protection sprinkler system, or from a household device.
  • A steam or hot water heating system, an air conditioning system, or an automatic fire-protection system breaking apart, splitting, burning, or bulging.
  • Freezing of a plumbing, heating, air conditioning, or automated fire sprinkler system, as well as a household appliance.
  • Damage caused by artificially created electrical current that occurs suddenly and unintentionally (does not include loss to a tube, transit, or similar electronic component)

What Does the Condo Association Master Policy Cover?

A simple condominium master policy addresses two issues:

  • The association’s general liability
  • Property damage coverage for communal areas

But what is the scope of the master policy? Condo associations will often select one of three types of coverage:

  • Bare walls – confined to the building’s basic framework, including fixtures and furniture collectively used
  • Individual units’ building structures, common areas, and fixtures are covered by a single entity, but not personal property or improvements.
  • Cover the structure as well as fixtures in individual apartments and any further enhancements done by you or a prior owner.

What Is the Difference Between the HO6 and HO3 Policies?

The benefit of being a condo owner is that you have some assistance in caring for the structure that contains your property – and your dwelling coverage reflects that. Here are some important distinctions between an HO6 policy and a home insurance policy written as an HO3.

Dwelling Coverage Differences Between HO6 and HO3

Open perils dwelling coverageYesYes
Replacement cost dwelling coverageYesYes
Policy covers entire structureNoYes
Covers other structuresDepends*Yes
Covers contents of the homeYesYes
Covers loss of useYesYes
Covers personal liabilityYes**Yes
Covers medical paymentsYesYes

*Generally, HO6 insurance expands coverage to areas and goods that an HOA requires owners to insure or that are already an owner’s obligation. **HOA policy applies to common spaces.

Single-family homeowners must insure everything on their own, including the complete house, garage, fences, and other structures. However, condo owners are only required to insure the wall coverings in their units and whatever else their condominium documents require them to cover. The master policy of your condo association normally covers anything outside the walls of your unit.

As a result, your condo’s dwelling coverage limits may be significantly lower than the amount you paid for your unit. The condo association’s policy essentially covers the majority of your residence insurance costs.

Personal liability is another area where condo insurance and homeowners insurance varies significantly. If someone is injured in your single-family home’s driveway, you are liable for the injury and any following medical expenditures.

But what if the injury occurs in the courtyard of your condo building? The incident is most likely covered by the master insurance policy.

HO6 for a Townhouse

A townhouse may require an HO6 policy, while others may require HO3 insurance. In general, an HO6 policy is appropriate if your townhouse:

  • Other unit owners share the walls.
  • Owners share care for exteriors or shared areas.
  • Is a member of an HOA with a master policy.

If, on the other hand, your townhome is freestanding and you are liable for the outer structure or your roof, you may require HO3 insurance.

How to Acquire HO6 Insurance

It is really simple to obtain a condo insurance policy online. Simply enter your address and we’ll do the rest.

In some situations, we may require two documents to finalize your coverage:

  • A copy of your wind mitigation inspection report.
  • Your current home insurance provider’s declarations page.

What is the Cost of Condo Insurance?

According to the National Association of Insurance Commissioners 2019 data, the average cost of condo insurance is $512 per year, the most recent version available. The cost of condo insurance varies greatly based on where you reside, how much coverage you require, and the deductible you select. Check out your state’s typical condo insurance premium:

StateAverage annual cost
New Hampshire$347
New Jersey$457
New Mexico$415
New York$578
North Carolina$502
North Dakota$293
Rhode Island$524
South Carolina$504
South Dakota$303
Washington, D.C.$377
West Virginia$320
Data from the National Association of Insurance Commissioners, 2019.

How to Purchase Condo Insurance

Many organizations that sell homeowners insurance also sell condo plans. Consider the following companies that are readily available:

  • Allstate.
  • Amica.
  • Chubb.
  • Farmers.
  • Liberty Mutual Insurance Company
  • Nationwide.
  • State Farm Insurance.
  • Travelers.

Condo insurance quotes are typically available on the insurers’ websites or by phoning them directly. If you’d rather not do the homework, you can hire an independent agent to compare estimates for you.

What is the Purpose of HO-6 Insurance?

As previously said, while your HOA may cover common spaces and the property on which your place is located, it does not cover your unit (walls, ceilings, floors, etc.) or the items within (including you!).

Pro tip: Examine everything you own and your lifestyle to ensure you have enough supplemental coverage for any eventuality.

A decent method to figure this out is to ask yourself, “If anything happened to my goods today, how much would I be able to cover out of pocket?” Is it all? Some? None? That’s where Ho6 insurance comes in: you pay on a monthly basis, so you’re covered if something horrible happens.

How much HO-6 Condo Insurance Do I Need?

The level of coverage in your condominium building’s master policy will determine how much condo insurance coverage you require. Before you set up your own policy, you should normally check out how the internal structure of your condo is protected by the building policy. There are three types of master policies that govern how much dwelling coverage you require in your condo policy:

A bare walls policy covers only the structure of the condo, which is practically everything behind the condo walls, including the drywall itself, frame, wiring, plumbing, and insulation.

Single entity coverage protects everything that a bare walls policy protects, but it also includes coverage for fixtures like worktops, sinks, and built-in appliances. It usually does not offer coverage for changes.

All-in coverage: This is the most complete sort of coverage, and if your building has this type of master policy, you probably don’t need to add any dwelling coverage to your condo insurance policy. All-inclusive master policies cover the whole interior construction of the condo, including fixtures, appliances, and changes.

What is Loss Assessment Coverage in an HO-6 Policy?

Loss assessment coverage is an optional coverage that you can add to your condo insurance policy. If a common area is damaged and the cost of repairs exceeds the master policy coverage limits, your HOA may divide the leftover costs among members. Loss assessment coverage is intended to cover these expenses.

Consider increasing the limitations on your loss assessment coverage.

Most condo insurance policies include $1,000 in loss assessment coverage, but you may frequently extend your amount up to $50,000. If you live in a condo association, consider increasing your loss assessment coverage in case you are assessed an outrageous amount.

You are covered in three ways when you have loss assessment coverage. You are safe from:

#1. Property damage to a building

If you are assessed for covered damages to common areas that are the responsibility of the condo association, loss assessment coverage will reimburse your portion of the assessment. Damages are normally assessed only when the master policy coverage has been exhausted.

#2. Liability Evaluations

If your condo association is lawfully proven liable for a guest’s accident in a building or common area, a loss assessment coverage endorsement might help pay your half of the responsibility for damages.

If someone is seriously hurt in the community pool area and the victim’s family sues for $1.2 million, your association may assess $200,000 to association members if the master policy limit is $1 million. Also, if the condo association had 25 members, each unit would be assessed $8,000 in fees.

#3. Assessments for master policy deductibles

Following a loss, certain condo communities may charge the master policy deductible to members. If you are assessed a portion of the deductible, your loss assessment coverage may help pay for that portion. Master policy deductible assessments are especially frequent in condo communities that choose higher deductibles, such as $25,000.

How Can IReduce Condo Insurance Costs?

There are three main strategies to save money on condo insurance:

  • Look around. To discover the best price for the coverage you desire, we recommend receiving quotes from at least three insurance companies.
  • Look for bargains. If you combine your condo and auto insurance with the same insurer, you may be able to save money. Some insurers provide savings if your unit has security features such as smoke alarms and deadbolt locks.
  • Increase your insurance deductible. Do not do this unless you are convinced that you have adequate savings to cover the larger sum in the event of an emergency. Otherwise, the decreased premium may be ineffective.

Is It Necessary to have HO-6 Condo Insurance?

Residential insurance coverage is not required by law for home or condo owners, but many mortgage lenders will demand condo owners obtain enough coverage for the condo’s construction to preserve their investment.

If your building master policy is “bare walls in,” your lender will most likely want enough coverage to entirely repair the condo’s inner structure if it is damaged or destroyed. If your building policy has all-inclusive coverage, you’ll probably just need enough condo insurance to cover improvements, modifications, or renovations.

What Insurance Do You Need for a Condo?

Condo insurance, commonly referred to as HO-6 insurance, is a policy that is designed to work in conjunction with the master insurance policy held by your organization. It protects your personal possessions as well as, in many instances, permanent fixtures in your unit such as appliances that are built-in. In the event that you are sued for negligence or if you need to relocate while disaster repairs are being made, it also helps with the associated costs.

Does Condo Insurance Cover Special Assessments?

Not all individual condo policies contain loss assessment coverage. Even if it does, it most likely won’t cover every special assessment even if it does cover some of them. For instance, because insurance doesn’t cover normal wear and tear, your policy probably won’t help pay for a special assessment that’s required to repair your roof because it’s getting old. If, however, the roof were to be destroyed by fire, the loss assessment coverage that you have would most likely pay out because the majority of insurance policies cover fires.

Do You Need Homeowners Insurance for a Condo?

If you have a mortgage on your condo, your lender will almost certainly require you to get insurance for it. Buying insurance is a prudent financial decision. Condo insurance, on the other hand, is not comparable to a regular homeowners insurance policy because it only covers your individual unit and not the building as a whole.

What Is Hoa Insurance?

The homeowners association (HOA) of your condominium development is the entity that is liable for having a master insurance policy in order to protect the common areas of the property. Your HOA dues, whether they are paid monthly or annually, typically include a contribution toward the cost of a master policy. Your complex is protected against losses incurred as a result of accidents or injuries that take place in “common spaces,” such as meeting rooms, swimming pools, tennis courts, and other communal areas. This coverage is provided by the master policy. Coverage limitations and exclusions on your HOA master insurance policy will differ depending on your condo association. These differences might be helpful in determining what coverage is required for your individual condo insurance policy because they indicate what is not covered.

HO-6 Policy FAQs

What is the difference between ho3 and HO6?

Homeowners with HO-3 and HO-6 insurance have various needs. HO-3 insurance is intended for single-family residences, whereas HO-6 insurance is intended for condominiums.

What is the most common homeowners insurance policy?

According to the National Association of Insurance Commissioners, the most prevalent homeowners insurance policy form is the HO-3, commonly known as a “special form.” An HO-3 policy provides “open danger” coverage for your home’s structure.

What are the three types of homeowners insurance?

Actual cash value, replacement cost, and extended replacement cost/value are the three basic types of coverage.


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