What Is Condo Insurance?

Quick Answer

Condo insurance covers condo units if they are damaged by a qualified threat. It also offers coverage for owners' belongings and some legal protections in liability suits.

A woman wearing an orange sweater sits on her couch while she talks on the phone inside her condo.

Condo insurance helps protect you financially if your condominium is damaged or your belongings are stolen from it. It also provides personal liability protections. You can purchase condo insurance on your own or with the assistance of a broker or agent. Condo insurance is one of the best ways for condo owners to protect their interests.

How Condo Insurance Works

Condo insurance is a type of homeowners insurance policy, also known as an HO-6 policy. This type of insurance covers damages within your condo unit and related to your personal belongings. Common areas outside of your unit such as hallways or roofs are typically covered by the homeowners association's insurance.

Condo insurance is usually required if you have a mortgage on your condo, and some homeowners associations require that all members carry a policy. Anyone wishing to mitigate losses from damage or an accident in their condo may want to carry a policy regardless of what's required.

What Does Condo Insurance Cover?

Like homeowners insurance, condo insurance is designed to protect the structure you live in. It also protects the items inside your condo and offers financial coverage for any liability issues. Condo insurance has some specific features that are useful to a policyholder living in a shared structure. Features of condo insurance coverage include:

  • Dwelling coverage: Coverage for damage to your condo such as from fire or water.
  • Personal belongings: Coverage for damage to or theft of items inside the condo like furniture or electronics.
  • Personal liability: Protection for if you're named in a lawsuit for accidental harm to others or damage to their property.
  • Medical payments: Financial provisions for medical payments when someone is injured at your condo.
  • Temporary housing costs: Financial provisions to cover temporary housing and basic necessities if you must leave your condo due to damage.
  • Loss assessment coverage: Protection for condo owners if their condo associations expect unit owners to share in costs for damage to common areas in the complex.

Though many issues are covered under condo insurance, it's important to understand any specific exceptions or unnamed exclusions in your policy.

What Is Not Covered by Condo Insurance?

Though there is wide coverage for personal and financial protection under condo insurance, there are a few specific items that are not covered under condo insurance policies, including:

  • General living damage: Scuffed floors and chipped paint that result from typical wear and tear are not covered by insurance.
  • Hazardous local conditions: A riverside condo may need separate insurance coverage for flooding, for example.
  • External water damage: Damage caused by water lines entering or beneath the condo is likely not covered.
  • At-fault injury or damage: If you intentionally hurt someone else, condo insurance liability coverage will not apply.

If you are concerned about condo insurance exclusions, talk to your insurer or an agent or broker. They can help you add additional policies such as a flood insurance policy. This can give you peace of mind about your coverage.

How Much Does Condo Insurance Cost?

The average condo premium from 2020 to 2022 was $487, according to Experian data. This is less expensive on average than a homeowners insurance policy, which averaged $1,267 in the same period.

Many factors go into condo premium pricing, but location is a big one. In 2021, the highest priced condo insurance was in Florida for $964 on average, while Utah saw policies ring in at $269.

It is possible to reduce the cost of your insurance. You can get the best price for condo insurance by:

  • Shopping around: Comparing prices for condo insurance policies can help you find the best cost-to-coverage value. Request quotes from multiple companies or work with a broker or agent to easily compare a variety of policies. Make sure you're comparing similar policies and coverage levels.
  • Raising the deductible: Raising your deductible—the part you pay out of pocket when you file a claim—can help lower your monthly premiums. But make sure your deductible remains affordable in case you need to file a claim.
  • Bundling your policy: You may be able to bundle condo insurance with another policy like auto. Many insurers offer discounts when you bundle two or three policies together.
  • Applying discounts: Other discounts may be available as well. You may be eligible for discounts through a professional organization or a school alumni program. You may also get discounts for going a specified amount of time without filing a claim.
  • Adjusting coverage: Your policy is likely divided into a variety of coverage limits. A particular limit may apply to dwelling coverage and another to personal property. By adjusting these limits, you may be able to lower your overall cost. Be sure to still maintain adequate coverage for your needs.
  • Improving your credit: Your credit can influence your insurance rates in many states thanks to credit-based insurance scores. Insurers can use these scores to consider your credit history while pricing insurance policies. By improving your credit, you may be more likely to be offered a lower rate.

Remember, your premium amount will ultimately depend on many factors, including your financial history and current location, so they may vary from company to company even if you take steps to reduce the total.

How to Buy Condo Insurance

You can buy condo insurance on your own or by working with a broker or agent. Brokers and agents can do the work of finding potential insurers and getting quotes. They can help you decide what coverage you need and how much is worth buying. To get started with the purchase process on your own or with assistance, you can:

  1. Get condo insurance quotes. When purchasing insurance on your own, you can typically request quotes through online portals or by contacting the insurer. The quote may require some information about you, your condo and your location. It will provide an estimated cost.
  2. Compare condo insurance prices and coverage. After you get quotes, compare prices and coverage. Don't just opt for the least expensive plan, though. Make sure it has adequate coverage for your unit, belongings and liability protection too.
  3. Finalize a policy purchase for condo insurance. Once you choose a plan you like, finalize your purchase and begin paying your premiums. Make sure to pay on time to prevent gaps in coverage.

The Bottom Line

Condo insurance can provide you with coverage for your home and belongings as well as legal protections. Your association or mortgage lender may require that you hold a policy. But even if they don't, it is typically an affordable insurance that offers a wide range of coverage and is worth purchasing.

If you're looking for a condo insurance policy, Gabi®—a part of Experian—can help you compare policies. Gabi shops for the best condo insurance for you for free, so you can choose the best deal from over 40 insurance providers. See what you can save in just minutes.