Do I Need a Homeowners Insurance Policy for a Townhome?
Usually yes. Lenders require it, and your own policy covers interior walls, belongings, and liability the HOA's master policy doesn't.
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What the HOA's master policy covers is spelled out in its governing documents, often as either bare walls or all-in. That detail decides how much of your own place you need to insure. A bare walls policy stops at the studs, so your HO-6 has to cover drywall, flooring, cabinets, and any upgrades you made inside. If a pipe in the unit next door floods your living room, your policy usually pays for your damage first. Loss assessment coverage then helps if the HOA bills owners for what its own policy didn't cover.
Rebuilding an interior after a bad water or fire loss runs well past what a thin HO-6 limit provides, and a loss assessment bill from the HOA can land on top of that without warning. Coverage priced to the master policy's category and the unit's finishes costs little next to what's owed if both fall short. Comparing policies now is the way to see that gap before it becomes a bill.
How much HO-6 coverage does a townhome actually need
Start with the HOA's governing documents, not a guess. They name the master policy's deductible, and that number matters more than people expect. Master policy deductibles on HOA claims often run from a few thousand dollars to tens of thousands, and many governing documents make unit owners responsible for a share of it through a special assessment. Loss assessment coverage on an HO-6 is what pays that bill, and the limit on a standard policy is often low. If the HOA's deductible is high, the loss assessment limit should be raised to match it.
The dwelling portion of an HO-6, sometimes called coverage A, needs its own number too. This is not what the unit would sell for. It's what it costs to replace drywall, cabinets, flooring, built-ins, and any upgrades made since the building went up, using current labor and material costs. A unit with original cabinets and a unit with a renovated kitchen need different limits even if they're the identical floor plan. A contractor's estimate or a renovation receipt is a better guide than a guess, and the number should be revisited after any remodel.
Personal property coverage works the same way everywhere else. It's the total cost to replace furniture, electronics, clothing, and everything else inside if all of it were lost, and most policies set it as a percentage of the dwelling limit unless a different amount is chosen. A quick household inventory, even a rough one, shows whether that default number is close or far off. Liability coverage is worth a second look too. It pays if someone is hurt in the unit or if damage from the unit reaches a neighbor, and the standard limit on a basic policy is often lower than what a serious injury claim could cost.
Loss of use coverage, sometimes listed as coverage D, pays for a place to live and meals out if the unit becomes unlivable during repairs. After a fire or a bad flood from upstairs, repairs on a townhome interior can take months, and that cost adds up fast without this piece in place. None of these numbers come from a formula that fits every building. They come from reading what the master policy actually promises, pricing out what the unit itself would cost to put back together, and sizing the HO-6 to the gap between the two.
What deductible should the HO-6 carry
The HO-6 deductible is a separate choice from the HOA's master policy deductible. The two do different jobs. The master policy deductible applies to a claim on the building as a whole, the kind that can trigger a special assessment. The HO-6 deductible applies only to claims on the unit owner's own policy, like a kitchen fire or a pipe that bursts inside the unit itself. Raising the HO-6 deductible lowers the premium. That trade-off is worth making deliberately rather than by default, since the lowest deductible offered isn't always the one already on the policy.
A higher HO-6 deductible makes the most sense when there's cash on hand to cover it without strain. The deductible is what's paid out of pocket before coverage starts on any claim filed under the personal policy. A lower deductible costs more every year but means less exposure if a claim comes up. Neither choice is right for everyone. The HOA's deductible doesn't factor into it directly, since that number is about the loss assessment limit, not the HO-6 deductible.
Some states and some HOAs set rules about minimum coverage unit owners must carry. Some governing documents tie a minimum HO-6 limit to the master policy's deductible. Where that exists, it's written into the HOA's bylaws or covenants, not into state insurance law, so the governing documents are the place to check, not a general assumption about what's typical. A condo or townhome board can also require proof of insurance each year, and the limits on file need to match what the bylaws actually call for.
One more detail worth checking is whether the HO-6 policy includes ordinance or law coverage. If the building is older and a covered loss triggers a rebuild, current building codes may require upgrades beyond what the original unit had, things like updated wiring or fire-rated materials. A master policy may or may not cover that gap for shared structures. A unit owner's own ordinance or law coverage, where offered, fills in what's left on the interior side. It's a smaller add-on next to the dwelling and loss assessment limits, but it matters most on the oldest buildings, where code has moved the furthest since construction.
Before the next renewal
Pull the HOA's governing documents. Check the master policy's deductible and whether it covers bare walls or everything inside. Those two facts decide what the HO-6 needs, and they're worth checking against the policy on file now.
