Condo and HOA insurance, both for the common areas and individual homes is an important topic to ensure that you are protected. Discover what insurance an association needs, and what you should get as a homeowner.

What is an HOA master insurance policy?

The HOA insurance policy covers costs and expenses for liability or repairs in common areas.

Damage & repairs

Property damage coverage will protect common areas in the same way that home insurance protects a home. For example, the insurance policy covers fires, winds, and damage to space by force majeure events.

Liability

HOA insurance also focuses on liability, in case someone sues the HOA. This protects owners from a special assessment to pay for legal fees. That means if someone falls over in the gym (or another common area), and sues the HOA, the liability policy will cover the expenses of a trial. It can also cover if staff or contract workers are injured working on the property.

To discover more about insurance in Florida, read our article by insurance expert, Taylor Spaedt.

Condo Insurance

For the condo building, as well as repairs and liability coverage, there can also be:

• Director’s liability: In case a board member is personally sued for omission.
• Fidelity liability: This protects if there is theft, fraud, or embezzlement in the association. Normally, it can only be used if a member of staff commits forgery or fraud.
• Workers’ compensation: This is necessary to protect employees and also contract workers. 

Homeowners Insurance vs Condo Owner Insurance

When you purchase your new home, you need to consider what insurance you need to cover you.

Homeowners Insurance

As a homeowner in an HOA, the division between your lot and the HOA is clear. It is important to look at different providers and decide what you need from your homeowner insurance. Most insurance providers cover theft of personal property and fire protection. However, they don’t always cover:

• Mold damage
• Roof leaks
• Water damage
• Plumbing problems
• Tree removal
• Foundation repair
• Fences
• Air conditioning
• Roof repair or replacement

It’s important to have insurance to protect yourself and your home, but you will also need to show proof of insurance before you are approved for a mortgage. 

Condo Insurance

With a few exceptions, your insurance needs as a condo owner are limited to the interior of your unit. A condo policy will cover elements such as: 

• Personal belongings — enough to repair or replace your stuff if it’s stolen or damaged.
• Interior structure — including items like flooring, inner walls, countertops, and fixtures.
• Liability — if guests are hurt in your unit or their belongings are damaged.
• Loss assessment — covering damages you might be held responsible for by your condo association, like damage to a common area.
• Loss of use — additional living expenses (those exceeding your normal standard of living) or fair rental value so you can maintain your quality of life if your home is uninhabitable due to a covered loss.

Before purchasing your own insurance, you should check the insurance of your condo building or HOA, to check what it covers. From there, you can decide what you need.

Wrapping Up: Condo and HOA Insurance

Ensuring that your condo and HOA insurance is up to date, and covers all key aspects of your community is important to protect everyone from special assessments. For individual homeowners, you also need to insure your home to avoid unexpected costs.