In this guide
Condo insurance, usually written on an HO-6 form, covers what the condo association's master policy does not: the parts of your unit you own or are responsible for, your belongings, your liability, and extra living costs after a covered loss. How much it needs to cover depends on what type of master policy your association carries, so the first step is to read your association's insurance documents.
Key takeaways
- An HO-6 typically covers your unit's interior (as defined by your community's documents), personal property, personal liability, medical payments to others and additional living expenses.
- The master policy type determines your gap: "all-in," "all-in excluding improvements," or "bare walls" (also called walls-out).
- Loss assessment coverage can help pay your share when the association bills owners after a covered loss that exceeds the master policy.
- Owners are typically responsible for the master policy deductible, per the Washington insurance commissioner's guidance.
- Lenders often require an HO-6, but you should buy based on your gaps, not just the minimum.
What an HO-6 policy is
"HO-6" is the standard form number for condo unit owners. It is a cousin of the HO-3 homeowners form, but it is smaller because the building's structure, roof and common areas are generally insured by the association, not by you. The policy is sometimes called "walls-in" coverage, though that label is not exact, since what you must insure depends on your governing documents.
The Washington Office of the Insurance Commissioner describes an HO-6 as typically covering:
- The unit's structure, based on the community's governing documents.
- Personal liability for claims against you.
- Medical payments for others injured on your property.
- Additional living expenses if your unit becomes unlivable after a covered claim.
- Personal property, often valued at actual cash value, with dollar limits that may be too low for valuables such as jewelry.
Master policy vs. your policy
The condo association (HOA) buys a master policy for the shared parts of the community. Where its coverage stops and yours starts is the most important question for a condo owner. The Washington guidance describes three common categories:
| Master policy type | What the master policy typically covers | What your HO-6 must cover |
|---|---|---|
| All-in | The exterior and all interior finishes | Mostly your belongings, liability and loss of use. The master deductible can still fall on you. |
| All-in, excluding improvements and betterments | Only the original finishes | Upgrades you made, such as custom cabinets or new flooring |
| Bare walls (walls-out) | Only up to the drywall and subfloor | All interior finishes, fixtures and built-ins |
The terms differ across associations, and the master policy language rules over any generic label. Ask the association's president or property manager which category applies, and request a copy of the master policy's declarations or certificate of insurance. Owners usually receive a certificate each year when the association's policy renews.
Loss assessment coverage
When damage to common property exceeds the master policy's limits, or when the master deductible is large, the association may charge owners a "special assessment." Loss assessment coverage on your HO-6 can help pay your share. As the Washington guidance explains, one example is wind damage to several roofs that requires an assessment. If the cause of loss is covered under your policy, the resulting assessment is generally covered too, up to your loss assessment limit.
Watch out: Some HO-6 policies include a small default loss assessment limit, and the master policy deductible can be large, especially for wind or hurricane events where it may be a percentage of the building's value. Check what limit you have and whether higher options are available. See our article on hurricane and windstorm deductibles for how percentage deductibles work.
What an HO-6 covers, part by part
Dwelling (interior) coverage
This pays to repair or replace parts of the unit you are responsible for insuring, for example flooring, cabinets, fixtures and paint, depending on your documents. If you have upgraded your unit, make sure your limit reflects the current cost, not the original builder grade. A written list and photos of improvements help.
Personal property
Your furniture, clothing, electronics and other belongings are covered for named perils on most forms. Check whether coverage is at replacement cost or actual cash value (see our explanation), and whether jewelry, art or collections have sub-limits. A home inventory helps you set the limit.
Liability and medical payments
If a guest is injured in your unit or you accidentally damage a neighbor's property, such as a water leak into the unit below, liability coverage can help with legal defense and damages. Water from your unit to another is a common condo claim. The HOA master policy may not respond to that kind of claim against you.
Loss of use
If a covered loss makes your unit unlivable, additional living expenses may pay for temporary housing and extra costs, up to the policy's limits.
What is not covered
- Flood: an HO-6 does not cover flood. Condo owners can buy NFIP coverage for their unit, and the association may carry its own. See our flood guide.
- Earthquake: typically excluded and needs an endorsement or separate policy. See earthquake insurance explained.
- Wear and tear and maintenance issues inside your unit.
- Business activity beyond limited home office property.
- Short-term rental use in many policies, if you rent out your unit. Ask first, since you may need a different policy.
How much to buy: a practical approach
- Get the association documents. Find the declaration, bylaws and master policy summary.
- Identify your master policy type and what the association says owners must insure.
- Estimate your interior rebuilding cost. Include flooring, cabinets, countertops, fixtures, paint, and any upgrades.
- Total your belongings. An inventory is better than a guess.
- Review loss assessment limits against the master deductible and the association's reserves. A healthy reserve fund lowers the odds of special assessments. Ask for the budget or reserve study.
- Choose liability limits that reflect what you could lose in a claim. Condo owners are often exposed to water-leak claims by neighbors.
- Compare quotes from several insurers, since coverage terms and pricing for condos vary.
The Washington insurance commissioner's office also notes that rates for these communities have risen significantly since 2019, so reviewing the master policy at renewal can help you spot changes in deductibles or coverage. If you are buying your first unit, see home insurance for first-time buyers, and for general rate pressure, why home insurance is going up.
Mortgage and lender requirements
If you have a mortgage, your lender will typically require proof of insurance, and for a condo, the lender often looks at both your HO-6 and the master policy. Requirements differ by lender and loan type. Ask your lender what they need, and give your agent the details early so a policy is in place before closing.
Frequently asked questions
Do I need condo insurance if the HOA has insurance?
The master policy generally does not cover your belongings or your liability, and may not cover your interior finishes. An HO-6 fills those gaps. Lenders often require it, too.
What does "walls-in" mean?
It is shorthand for coverage from the interior walls inward. The exact boundary depends on your association's governing documents, so ask which master policy category applies.
What is loss assessment coverage?
It helps pay your share of a special assessment the association charges owners after a covered loss to common property exceeds the master policy. Limits vary.
Who pays the master policy deductible?
According to Washington's insurance commissioner, owners are typically responsible for the community master policy deductible. Your governing documents define how it is allocated.
Does condo insurance cover a leak from my unit that damages a neighbor?
Personal liability coverage may respond, subject to the policy's terms. This is a common condo claim, so liability limits are worth reviewing.
Sources
- Washington Office of the Insurance Commissioner – Learn how condo insurance works
- NAIC – Homeowners Insurance
- West Virginia Offices of the Insurance Commissioner – Policy types
- FloodSmart (NFIP) – Buy a Flood Insurance Policy
General information only. This guide explains general concepts and is not insurance, legal or financial advice. Rules and prices vary by state and insurer. Check your policy documents and speak to a licensed insurance professional or your state insurance department about your situation.