Compare Condo Homeowners Insurance

Condo insurance helps pay to repair or replace your condominium and your possessions in the event they are damaged in an accident, disaster, theft, or other peril.

Condo insurance is also known as an HO6 policy. HO6 policies are made to cover the “walls-in”, meaning the coverage begins from the interior walls and extends to the contents inside. In other words, condo insurance does not cover the structure and the outside of your unit. Your condo or homeowners association (HOA) should have their own insurance policy for the structure and exterior of the building, including common areas.

In addition to covering your condominium and your belongings, condo insurance can offer additional protection with liability coverage. Let’s say a visitor is injured in your condominium, or you accidentally cause a fire that damages your neighbor’s unit. In each circumstance, you could be held liable to pay for the damages. But with liability coverage, your condo insurance helps pay for the medical, legal, and repair bills in the event someone is injured in your home or you accidentally cause damage to another’s property.

Read on to compare condo insurance options below.

Why Should I Get Condo Insurance?

Purchasing a condo can make a lot of financial sense. You can enjoy the benefits of homeownership, but without the higher maintenance costs that come with owning a house outright.

Buying condo insurance also makes good financial sense. For instance, if your stove was accidentally left on and caused a fire in your kitchen, without condo insurance you would be responsible for the full cost to repair the damage (and replace any appliances). In other words, condo insurance helps safeguard you and your home from risk.

How Does Condo Insurance Work?

But how does insurance work when you own the interior of your condo, but not the exterior?

First, your homeowner’s association (HOA) will likely have their own coverage, known as a master insurance policy. HOA master insurance coverage most often stops at the exterior walls of your unit. It is unlikely that your HOA’s insurance will cover the interior of your condo and your possessions -- that is your financial responsibility.

Solely relying on your building’s policy can also leave you liable if you accidentally cause property damage or bodily injury to others. If leaving the stove on also caused a fire in your neighbor’s unit, without condo insurance, you would have to pay for the repair costs for their unit yourself. Or, say you leave water on the floor and your guest accidentally injures herself -- without coverage, you would have to pay for her medical costs and, if she sues, any legal fees.

Additionally, some HOAs or mortgage lenders may require condo owners to purchase their own coverage.

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What Does Condo Insurance Cover?

A standard condo insurance policy typically includes:

  • Dwelling coverage: Known as “walls-in” coverage, helps to pay to repair or replace the interior of your condo, including the walls, fixtures, cabinets, doors, etc., in the event it is damaged due to peril.
  • Personal property coverage: If a peril damages your possessions, such as your appliances, furniture, electronics, clothes, etc., this coverage helps pay to repair or replace what was lost.
  • Liability coverage: This protects you from being held liable in the event a guest is injured in your condo or you accidentally cause damage to another’s property.
  • Loss of use: Reimburses the cost of a hotel and other living expenses in the event your condo is not livable due to damage.

The following perils are typically covered by condo insurance:

  • Damage from fire (though, depending on where you live, wildfires may require a separate policy)
  • Damage from heavy winds or hurricanes
  • Tornado damage
  • Theft or vandalism incidences
  • Smoke damage
  • Damage caused by the accidental discharge of water

If you live in a high-risk zone, hazards such as wildfires, floods, and earthquakes may not be covered. In such cases, you will need to purchase separate coverage.

How Much Condo Insurance Do I Need?

To determine how much condo insurance to purchase, first calculate the amount of dwelling coverage you need. Dwelling coverage is to cover the structure of your condo’s interior, such as the walls, cabinets, doors, fixtures, etc.

Your homeowner's association (HOA) likely has a master insurance policy. Most will not cover the interior structure of your condo. That said, it is a good idea to ask the manager of your HOA if the master insurance policy includes any dwelling coverage for the interior of your unit, and if so, what the coverage amount is.

At a minimum, you should have a dwelling coverage amount of at least 20% of your condo’s value. For example, if your condo currently appraises for $500,000, you will need at least $100,000 in dwelling coverage. After accounting for the dwelling coverage included in your HOA’s master policy, visit some real estate website to get an idea of your condo’s estimated value. And don’t forget about your finishings. If you recently remodeled your condo, or if you have higher-end flooring, fixtures, cabinets, or other upgrades, you will need to factor these into the calculation. For an accurate figure, consider getting an appraisal.

The next step is to determine how much personal property coverage you may need. To do so, you will need to estimate the total value of your possessions. You can do this by creating an itemized list.

Lastly, assess the level of risk in your area. Are there a lot of natural disasters, such as wildfires, floods, or earthquakes? Is there a high crime rate? Knowing what risks are most likely to happen can help you determine the right level of coverage.

If at any time you are unsure about how much condo insurance you need, it is a good idea to ask your agent while you are comparing quotes.

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