What Is Condo Insurance or HO-6 Insurance Coverage?
HO-6 insurance, or condo insurance, is designed specifically for condominium unit owners. It provides essential protection for personal property, interior improvements, liability, and loss assessments. Understanding this coverage is crucial for navigating condo ownership and ensuring you’re financially protected.
Unit vs. Common Elements in a Condominium
Understanding the difference between units and common elements is critical for knowing what you’re responsible for as a condo owner.
Defining Unit Boundaries
- Units: Include interior surfaces like drywall, flooring, cabinets, and fixtures within the unit.
- Common Elements: Cover shared property such as structural components, roofs, lobbies, and hallways.
- Limited Common Elements: Reserved for specific units, such as balconies or parking spaces, but often maintained by the condo association.
➡️ Learn more about condo insurance responsibilities on our Homeowners Insurance page.
What Are the Association’s Responsibilities?
The condominium association manages insurance and maintenance for common elements, as outlined in the Pennsylvania Uniform Condominium Act (PUCA). However, your association’s documents, such as bylaws and declarations, will supersede PUCA’s rules. If the association’s documents do not address a specific topic, PUCA serves as the default guide.
Insurance Responsibilities
- Maintain a master insurance policy for common elements.
- Cover structural damage, roof repairs, and shared utilities under the policy.
Maintenance Responsibilities
- Repair and replace common elements like the roof or shared plumbing after damage.
- Coordinate insurance claims for covered events such as fire or storm damage.
However, associations may charge unit owners a share of the master policy deductible for specific losses.
What Are the Unit Owner’s Responsibilities?
Unit owners must maintain an HO-6 condo insurance policy to cover:
- Personal Property: Furniture, electronics, and personal items.
- Interior Improvements: Upgrades beyond the original construction.
- Loss Assessment Coverage: Helps with shared costs when the association assesses fees for common property damage.
- Associations Deductible: In addition to having enough building coverage for upgrades to your unit, you should have enough to cover the associations deductible.
- Personal Liability: The HO-6 policy provides personal liability for the unit owner.
Pro Tip: Renters insurance is not a substitute for HO-6 insurance. Condo owners need specific coverage for structural components and shared costs.
When Does HO-6 Insurance Apply?
Example: Roof Damage
- A storm damages the roof over Building A.
- The association’s master policy has a $25,000 deductible, divided among affected units.
- HO-6 Loss Assessment Coverage or Building coverage typically pays your portion of this deductible.
Example: Burst Pipe in Your Unit
- The associations master policy should pay for damage to the structure of your unit and you policy’s building coverage pays for improvements you made to the structure.
- Your HO-6 policy pays for damage to your personal property.
- If your association charges you for the master policies deductible, this will most likely be paid by building coverage on your policy.
Why You Need Adequate Deductible Coverage
Insurance costs are rising for associations, often leading to higher deductibles. Many associations now require units affected by damage to pay a portion of these deductibles.
Plan for Condo Insurance Coverage Gaps
- Loss Assessment Coverage doesn’t always cover the master policy deductible.
- Your HO-6 policy should include enough building coverage to cover both the deductible and necessary interior repairs.
- Review your associations by-laws and declarations to ensure your have the correct coverage on you HO-6 policy.
➡️ Protect yourself by getting a personalized insurance quote today.
Key Takeaways on Condo Insurance
- Association Responsibilities:
- Insure and repair common elements.
- Handle master policy claims and determine deductible cost-sharing.
- Unit Owner Responsibilities:
- Maintain HO-6 insurance for interior damage, personal liability, and loss assessment.
- Ensure your policy includes adequate building coverage.
- Consult Governing Documents:
- Review your condo’s declaration to understand your responsibilities.
- Have Enough Coverage:
- Rising costs mean higher deductibles. Plan ahead to avoid out-of-pocket expenses.
- Every association is different based on their by-laws, declarations and other documents. Review them thoroughly.