Anyone who owns a condo or townhome should be aware that their personal possessions, personal liability and upgrades to the unit may not be covered under the Condominium Master Insurance Policy and therefore they will need to take out their own Condominium Unit Owners Policy. It’s important to understand the cost of Condominium Unit Owners Policies and Condominium Master Insurance Policies and compare quotes from various carriers. Working with an independent broker like Pullen Family Insurance Agency will allow you to get all of the competing quotes all at one place.

Let’s understand what an HOA’s Master Policy covers so you can make an informed decision on the amount of personal coverage for your unit. Typically, the Master Policy has “walls-out” coverage for all units in the building. Walls-out covers all real property contained inside the exterior framing, it does not cover any installations or fixtures within the unit itself. It insures the basic building(s) (walls, roof, floors, elevators) but leaves to the unit owner the responsibility of insuring appliances, carpeting, cabinets, wall coverings, and other items in your unit, and in some instances the interior walls. The HOA can add coverage for the unit owner’s personal property as well as their fixtures and improvements with additional premium. The Master Policy has commercial liability coverage specifically to cover the liabilities the building places onto others. Directors and Officers Liability coverage can also be added to insure against the mishandling of HOA funds by HOA management.

Knowing is half the battle and understanding how the Master Policy functions will allow unit owners to make the right decision on how much condo unit coverage to obtain. A Condominium Unit Owners Policy works a lot like a Homeowners Policy. Your Condominium Unit Owners Policy will protect your personal property and building upgrades against loss or damage from a number of specified causes, such as:

  • Fire or lightning
  • Weight of ice, snow or sleet
  • Windstorm or hail
  • Theft
  • Accidental discharge or overflow of water
  • Explosion
  • Riot or civil commotion
  • Accidental eruption of hot water heating system
  • Aircraft
  • Vehicle damage
  • Freezing
  • Smoke damage
  • Artificially generated electrical current
  • Vandalism or malicious mischief
  • Falling objects

Individual condo unit upgrades include counter tops, flooring, fixtures, cabinetry, shelving, doors etc. In a total loss, these items will add up to a considerable amount of money and it is important to have enough Dwelling/Building/Improvement & Betterments coverage to replace them. Personal property coverage is typically defined by anything that can fall out of the home if shaken and turned upside down. Examples: electronics, linens, clothing, furniture, appliances not bolted down, valuables, etc. For expensive items like jewelry, artwork and furs, you can schedule this property and get individual protection for each item. Most policies have maximums for individual pieces of jewelry, artwork and furs, so scheduling high value items is necessary. Personal property is subject to a deductible before replacement.

Not only will you be forced to obtain a Condo Unit Owners Policy by your mortgage lender, but it is important to obtain this coverage to fill in the gaps the Master HOA Policy leaves you exposed to.

Some simple tips for condo owners:

-Dwelling/Building coverage: 20% of purchase price or $250k whichever is less
-Maintain an inventory of personal property
-Have a separate inventory of jewelry, art and furs

Some tips for HOA Management:

-Know the reconstruction costs of your area to have accurate Building Coverage amount
-Include Directors & Officers Liability
-Include Inflation Guard (increases building coverage 1-2% a year)


-Jacob Pullen, CIC-
Pullen Family Insurance Agency