How Much Condo Insurance Do You Need?
The amount of condo insurance you need depends on the level of protection you need to cover your condo and belongings, minus whatever coverage your association’s master policy provides.
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Written byLindsay VanSomeren
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8 years in insurance and personal finance writing
Former data scientist for U.S. Geological Survey
Lindsay is a freelance personal finance writer currently pursuing her Series 65 license. She enjoys helping readers learn money management skills that improve their lives.
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Edited bySarah Archambault
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Experienced personal finance writer
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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Table of contents
Condo owners need to take a few extra steps to figure out how much condo insurance they need compared to someone who owns a single-family home. That’s because your condo owners association (COA) already has a master policy in place that may offer some coverage. And you can also choose from different types of condo coverage that can help protect you against some of the extra costs of condo living.[1]
Here’s a closer look at how to check the coverage you already get through your condo association’s master policy and how to determine how much extra condo insurance you may need. Comparing home insurance quotes is the best way to save money on condo insurance.
Quick Facts
An individual condo policy costs about $1,014 per year for a policy with $400,000 in dwelling coverage.
Condo insurance, also known as an HO-6 policy, contains a specific list of coverages just for residents who own individual units in a shared building.
Condo insurance also offers coverage against high one-off levies that your association may charge for repairs to common areas.
Calculating how much condo insurance you need
Condo insurance isn’t too different from homeowners insurance, but it has a few twists. Consider this step-by-step list to make sure you’re buying the correct amount and types of coverage for your condo unit.
Check with your condo association. Your COA should be able to let you know how much condo insurance you already have under its master policy. You can also ask if you’re required to carry an additional condo insurance policy.[2]
Reach out to your mortgage lender. Banks or other lenders often have rules in place about how much insurance coverage you need to buy to protect their investment.
Do an inventory of your possessions. It’s a good idea to have a list of all your personal possessions in case you ever need to file a claim. And this list can help you estimate how much coverage you need for your belongings.
Estimate the replacement cost of your condo. An insurance agent or financial advisor can help you estimate this amount. Depending on where your COA’s insurance coverage ends, it’s a good idea to insure your condo for the difference.
Consider how much liability coverage you need. Estimate what you could potentially lose in a lawsuit, such as any savings or other property you own. Most policies start with $100,000 in personal liability coverage, but experts often recommend purchasing more.[3]
Scope out any additional coverages you might need. A standard HO-6 policy for condo owners doesn’t cover everything, such as flood damage from natural disasters or drain pipe issues. Consider whether you need these add-ons.
Compare quotes from multiple condo insurers. Shop around to compare prices and coverage options to find the best condo insurance for your needs and budget.
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How condo insurance works and what it covers
Condo insurance involves two types of policies: your COA’s master policy, which protects the building structure and common areas, and individual condo insurance, which covers the things inside your unit.
Condo owners can’t choose the master policy coverage level, but you can decide on your own condo insurance policy to protect whatever the master policy doesn’t. When choosing how much condo insurance you need, it’s important to consider the different types of coverage for other financial losses, such as personal liability and your belongings.
Here’s a closer look at condo insurance coverage options and what they protect.
Dwelling coverage
Dwelling insurance helps pay for materials and construction costs in the event of a covered loss, such as fire. Your condo association’s master policy may or may not cover damages to your own unit. It’s a good idea to ensure your unit is fully protected, either by your COA’s insurance or your own policy. Industry professionals recommend checking this every year to make sure it stays up to date.
Personal property coverage
Condo insurance covers your personal belongings up to your policy limits. If a tornado tears down your building, you’ll be able to buy a new wardrobe, for example.
Liability coverage
Condo insurance offers liability protection in case someone sues you. This coverage kicks in when someone is hurt visiting your home, but it can also help protect you in a lawsuit.
Most policies start out with $100,000 worth of liability insurance coverage. But liability claims can easily take most of your assets, so insurance experts often recommend carrying more — especially since adding extra liability coverage is usually fairly cheap.
Additional living expenses (ALE) coverage
ALE, also called loss of use coverage, can help you out financially if a covered peril destroys your condo or you need to relocate for a bit while it’s being repaired after a covered event. For instance, your policy’s ALE coverage can help pay for living expenses, like a hotel room, if you’re unable to live at home during repairs.
Loss assessment coverage
Sharing a building with others means that your condo association can come to you with large one-time bills to cover unexpected property damage. Or the COA may ask you to help pay the deductible before the master policy kicks in. These costs are split among unit owners, but that doesn’t mean they’re any easier to pay. Loss assessment coverage can help protect you financially from this type of loss.
Optional condo insurance coverages
As with homeowners insurance policies, a condo policy only pays out for covered perils — and some big-ticket items are common exclusions. Check with your agent to assess your potential risk and get a better idea of what additional insurance products you might need, including:
Flood insurance
Earthquake insurance
Condo landlord insurance (if you rent your unit out)
Vacant condo coverage (for long-term absences or vacation homes)
Scheduled personal property (for high-value items like jewelry or furs)
Water backup coverage (for sewers and drains that cause water damage in your home)
What a master policy covers
When you buy condo insurance, you’re buying coverage to fill in the gaps for whatever your condo association’s master policy doesn’t provide. That’s why understanding your master insurance policy is key, so you know what else you need. Your condo association can provide the details, but most master policies are one of three types:
Bare-walls coverage
This type of master policy covers all common areas and the interior walls of your unit. It doesn’t cover any of the cabinets, lighting fixtures, or floor coverings in your unit, even if they’re the original items that the developer put in.
Single-entity coverage
A single-entity policy covers everything that a bare-walls policy covers, plus the original fixtures that the developer included in your unit (or something comparable if your unit has been remodeled). That means if you’ve invested in a lot of upgrades, you may need to buy extra dwelling coverage.
All-in coverage
This type of master policy offers total building property coverage, including any upgrades or remodels you’ve done to your individual unit. It’s the most comprehensive type of master policy available, but it also comes at a higher premium.[4]
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How much condo insurance costs
The cost of condo insurance depends on a number of factors, such as your location, your credit history, and how much coverage you buy. Insurify compared the cost of an HO-6 insurance policy for a condo with $400,000 in dwelling coverage across different states and companies.
The average cost of condo insurance nationwide is $1,014 per year. That cost can vary dramatically depending on where you live. For instance, residents of Texas pay the highest annual costs ($3,651), while New York residents pay the lowest ($265).
The following table shows how the annual average for condo policies varies by location:
The below rates are estimated rates current as of: Thursday, September 4 at 12:00 PM PDT.
State  | Average Annual Cost: With $400,000 in Dwelling Coverage |
|---|---|
| New York | $265 |
| Hawaii | $290 |
| Vermont | $397 |
| New Hampshire | $469 |
| Pennsylvania | $497 |
| Maine | $503 |
| Washington D.C. | $507 |
| Nevada | $522 |
| Oregon | $545 |
| Wisconsin | $568 |
| Minnesota | $579 |
| West Virginia | $605 |
| Utah | $609 |
| New Jersey | $617 |
| Virginia | $624 |
| Idaho | $700 |
| Connecticut | $708 |
| Wyoming | $708 |
| Maryland | $745 |
| Ohio | $764 |
| Montana | $783 |
| California | $833 |
| Illinois | $878 |
| Michigan | $885 |
| Iowa | $893 |
| Indiana | $917 |
| South Dakota | $931 |
| Georgia | $942 |
| South Carolina | $991 |
| North Dakota | $1,007 |
| United States | $1,014 |
| New Mexico | $1,075 |
| Colorado | $1,094 |
| Missouri | $1,109 |
| Tennessee | $1,139 |
| Alabama | $1,196 |
| Arkansas | $1,218 |
| Mississippi | $1,230 |
| Washington | $1,247 |
| Nebraska | $1,283 |
| Kansas | $1,355 |
| North Carolina | $1,400 |
| Delaware | $1,507 |
| Massachusetts | $1,705 |
| Oklahoma | $1,858 |
| Louisiana | $2,127 |
| Florida | $2,308 |
| Arizona | $2,350 |
| Kentucky | $2,949 |
| Texas | $3,651 |
Condo insurance FAQs
Choosing the right amount of condo insurance can be tricky. Consider this additional information as you shop for a condo policy.
What is the 80% rule in condo insurance?
The 80% rule says that homeowners should purchase a policy covering at least 80% of the cost to replace a home. It’s better suited to single-family homeowners than condo dwellers, who should instead base their coverage needs on what their building’s master policy doesn’t cover.
Is condo insurance required?
Generally, yes. If you’re still paying off a mortgage, your lender will usually require condo insurance. Even if you have a paid-off mortgage, most condo associations also require you to purchase condo insurance to ensure the building is fully protected, inside and out.
How do you calculate dwelling coverage for a condo policy?
Start with your condo association’s master policy to see what it doesn’t and doesn’t cover within your unit. From there, you can estimate how much coverage you’ll need for your individual condo insurance policy. It can be tricky to calculate, so consulting an insurance agent can help.
What types of insurance do condo owners need?
Condo owners should purchase an HO-6 insurance policy, which offers property damage protection and special coverage types for people owning units in a shared building.
How much is condo insurance?
Nationwide, the average annual rate for condo insurance is $1,014 for a policy with a dwelling coverage limit of $400,000. But residents of some areas, such as Florida, pay a much higher average rate of $2,308 per year.
Methodology
Insurify data scientists analyzed rates from more than 180 home insurance companies sourced directly from Insurify’s partner companies and Quadrant Information Services. Rates span all 50 states and Washington, D.C., and quote averages represent the mean price for a given coverage level and geographic area. To ensure data reliability, only insurers meeting minimum quote thresholds were included in the analysis.
Unless otherwise specified, quoted rates reflect the average cost for homeowners with no prior claims and good credit with a home construction year of 1980. The default coverage assumptions include:
Default Coverage Assumptions
- Dwelling coverage: $300,000
- Deductible: $1,000
- Personal property limit: $25,000
- Liability limit: $300,000
Additional data points beyond these default values are sourced from Insurify’s proprietary database. Rates are updated monthly.
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Sources
- Insurance Information Institute. "Insuring a co-op or condo."
- Insurance Information Institute. "Can I own a home without homeowners insurance?."
- Insurance Information Institute. "How much homeowners insurance do I need?."
- Community Associations Institute. "Community Association Insurance."
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Lindsay VanSomeren
Lindsay VanSomeren is a freelance personal finance writer living in Suquamish, WA. Her work has appeared with FICO, Credit Karma, The Balance, and more. She enjoys helping people learn how to manage their money better so they can live the life they want.
Lindsay has been a contributor at Insurify since October 2022.
Edited bySarah Archambault
Experienced personal finance writer
Background working with banks and insurance companies
Sarah enjoys helping people find smarter ways to spend their money. She covers auto financing, banking, credit cards, credit health, insurance, and personal loans.
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