What Does a Condo Association Insurance Policy Cover?

A condo association insurance policy, also known as a master insurance policy, covers shared spaces and protects members of a condominium community. This policy provides essential coverage for property damage, liability insurance, and common areas, ensuring that both the association and condo owners avoid unexpected costs.

Key Coverage Areas in Condo Association Insurance

Condo association insurance focuses on protecting the condominium complex as a whole, including shared amenities. Here are the main areas it covers:

1. Property Damage

This part of the policy covers the building’s structure and common areas, like:

• Building Exterior: Protects the exterior of the building, such as the roof, walls, and foundation.
• Shared Amenities: Covers areas like lobbies, gyms, pools, and elevators.
• Landscaping: Some policies include landscaping or outdoor structures.

For example, if a storm damages a shared lobby, the master insurance policy covers the repair costs.

2. General Liability Coverage

General liability protects the association if someone is injured in a shared area, such as:

• Injury Claims: Covers medical expenses or legal fees if someone slips in a hallway or falls near the pool.
• Damage to Personal Property: Covers accidental damage to guests’ property in common areas.

Without this liability protection, members of the condominium may need to cover these expenses through increased fees.

3. Directors and Officers Liability

This coverage protects the condo association board. It covers legal costs if board members face lawsuits for decisions they make on behalf of the community.

Types of Condo Association Insurance Coverage

Three main types of condo association insurance policies exist. Each insurance company may offer different levels of coverage:

Bare Walls Coverage

• Bare walls coverage protects only the basic structure, such as walls and insulation. It doesn’t cover interior features of individual units, like cabinets or flooring. Condo owners with bare walls coverage need their own policy to protect these items.

Single Entity Coverage

• Single entity coverage protects the building structure and some basic features inside each unit. This includes walls, floors, and original fixtures. It excludes any upgrades or changes made by unit owners.

All-In Coverage

• All-in coverage provides the most comprehensive protection, covering almost everything within each unit, including some upgrades. Condo owners still need their own policy to cover personal belongings and personal liability.

What Condo Association Insurance Does Not Cover

While condo association insurance protects the condominium complex and shared spaces, it doesn’t cover everything. Condo owners need separate insurance for:

• Personal Property: Items like furniture, electronics, and clothing are not included in the master policy. Condo owners need individual coverage for these.
• Personal Liability: Injuries or damages occurring within your condo unit are your responsibility.
• Interior upgrades, such as renovations and changes in individual units, do not receive coverage under the association policy.

Why Condo Owners Need Additional Liability Insurance and Property Coverage

Even with a condo association policy, condo owners need their own liability insurance and property coverage for complete protection. A personal condo insurance policy (HO-6) provides liability insurance for incidents inside the condo unit and covers personal property and any improvements or upgrades. This policy helps condo owners stay financially safe from risks not covered by the condo association’s main policy.

Condo association insurance protects the condo complex and its members from unexpected costs related to shared spaces. It is important for condo owners to have their own liability insurance and property coverage for full protection. Individual condo insurance covers personal belongings, improvements, and any liability within a unit, giving owners additional peace of mind.

Special Considerations: Flood and Earthquake Coverage

Standard condo association insurance policies don’t usually cover floods or earthquakes. In high-risk areas, the condo association may need separate coverage for these events. Condo owners can add flood or earthquake insurance to their individual policies for further protection inside their units.

Who Pays for Condo Association Insurance?

All unit owners fund the condo association insurance through their monthly or annual dues. These payments keep the policy active and ensure that the entire community stays protected. If the association needs to file a claim, unit owners might pay a portion of the deductible.

Frequently Asked Questions

Do Condo Owners Still Need Individual Insurance?

Yes, condo owners need their own policy even if the association has all-in coverage. This covers your personal belongings, liability, and any custom upgrades.

What’s the Difference Between Condo Association Insurance and Condo Owner Insurance?

Condo association insurance covers common areas and the overall building structure. Individual condo insurance covers everything inside your unit, including personal belongings and personal liability.

Can I Rely Only on Condo Association Insurance?

No, the association policy only covers shared areas and the building structure. You need an individual policy to protect your belongings and interior improvements.

Get a Condo Insurance Quote Today

Understanding condo association insurance coverage helps you know what’s protected. However, condo owners need their own policies for full coverage. At Harbor Insurance, we offer both condo association insurance and individual condo policies to meet your needs. Contact us today to get a quote and ensure complete protection for your condo.