What Insurance Should an HOA Have?
A master policy for shared structures and liability, plus HO-6 policies owners carry for their own unit and belongings.
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Where the HOA's policy ends and yours begins
The HOA's master policy covers the building's shared structures and common areas. That usually means the roof, the lobby, elevators, and the land, plus liability if someone gets hurt in those spaces. Where your own responsibility starts depends on how the master policy is written. A bare walls policy only covers the building's structure as it was built, leaving cabinets, flooring, fixtures, and the drywall inside your unit to you. A single entity or all-in policy goes further and includes those original finishes, so your own coverage picks up from there. Your HOA's governing documents or the policy's declarations page will say which type it is. An HO-6 policy fills whatever gap is left, covering your belongings, upgrades, loss of use, and liability inside your own unit.
The HOA's master policy was bought for the building, not for your finances. If a pipe bursts two floors up and the HOA's policy has a high deductible, that cost can come back to every owner as a special assessment, including you. Loss assessment coverage inside an HO-6 picks up that bill, and a quote shows what it costs to add enough of it for your building.
What does an HO-6 policy actually cover, and how much do I need?
An HO-6 policy is built around four pieces. Dwelling coverage, sometimes called Coverage A, pays for the interior of your unit, which is anything from the drywall in if your HOA carries a bare walls master policy, or your upgrades and improvements if it carries an all-in policy. Personal property covers your belongings, furniture, clothes, electronics. Loss of use pays your living costs if the unit becomes unlivable after a covered loss. Liability covers you if someone is hurt inside your unit and sues. How much dwelling coverage you need comes down to what it would cost to rebuild your unit's interior, not what you paid for the unit or what it would sell for. A condo in a high-cost city with elaborate finishes needs more than a similar unit with builder-grade everything. The HOA's master policy documents, specifically what they define as part of the building versus part of your unit, are the starting point for figuring out that number.
Loss assessment coverage is the piece that catches people off guard. When the HOA's master policy doesn't fully cover a shared loss, like storm damage to the roof or a liability judgment after someone falls in a common hallway, the HOA can bill owners directly for the shortfall through a special assessment. That bill gets divided among all the units, and your share can run into thousands of dollars even though nothing happened inside your own walls. Loss assessment coverage in your HO-6 reimburses you for that bill up to the policy limit. Most HO-6 policies include a small amount by default, often far less than what a real assessment could run, so it's worth checking the limit on your declarations page against what your HOA's reserve study or master policy deductible suggests could happen.
Water damage from a neighboring unit is one of the most common disputes in condo living, and who pays depends on where the water started and why. If a pipe inside the building's shared structure fails, that's typically a master policy claim. If the water originates inside your neighbor's unit, from a washing machine hose or a bathtub left running, your neighbor's HO-6 liability coverage may be responsible for the damage it causes to your unit, while your own HO-6 covers your belongings and any interior finishes regardless of fault, so you're not left waiting on someone else's insurer to repair your home.
Townhomes complicate this because they sit somewhere between a single-family house and a condo. Some townhome communities carry a master policy similar to a condo association, covering shared roofs or exterior walls, with owners carrying an HO-6 for the rest. Others treat each townhome as a standalone structure with no shared coverage at all, in which case the owner needs a standard homeowners policy, not an HO-6. The HOA's governing documents and insurance requirements settle which situation applies, and that document is worth reading before assuming either way.
What should I check before assuming my coverage is enough?
Start with the HOA's insurance certificate or summary, sometimes called an evidence of insurance. It names the master policy's type, the building's insured value, and the deductible the HOA carries. That deductible matters more than people expect. A $25,000 deductible on a roof claim or a $50,000 deductible after a fire in a common area is money the HOA has to come up with somehow, and if the reserve fund is thin, owners cover it through a special assessment. Knowing that number tells you roughly what loss assessment limit makes sense for your own policy, rather than guessing or accepting whatever default your insurer includes.
Ask the HOA, or check the governing documents, how assessments get divided among owners. Most associations split costs by unit based on square footage or ownership percentage, not evenly, so a larger unit can owe more than a smaller one after the same loss. If your unit is on the larger end of the building, your share of a special assessment runs higher than a neighbor's, which argues for a higher loss assessment limit than the policy's default.
Renovations are another thing worth revisiting, especially in buildings with a bare walls master policy. If you've upgraded flooring, built out a kitchen, or added custom cabinetry since buying the unit, that work is now your responsibility to insure, not the HOA's, even though it's physically inside walls the association partly maintains. Dwelling coverage set when you first bought the policy may not reflect what's actually inside the unit now. A quick way to check is comparing your HO-6 declarations page against what the renovation cost, not what you think the unit is worth today.
Finally, read the HOA's bylaws on what happens after a loss that affects both common areas and individual units, like a fire that starts in a hallway and spreads into several condos. Some governing documents specify how repairs are sequenced and who's responsible for what during that process, which affects how loss of use coverage in your own policy gets triggered. Where the documents are vague or you can't find a clear answer, the HOA's management company or insurance agent can usually clarify it directly.
Before you compare policies
Pull the HOA's insurance certificate and your HO-6 declarations page side by side. Check the master policy's deductible against your loss assessment limit, and confirm dwelling coverage still matches any renovations made since you bought the unit.
