Condo Association Insurance (HOA)
A condo requires a special master insurance policy to protect all of the owners shared or common areas such as walkways, stairs, pools and the exterior of the buildings. Often referred to as a “walls out” insurance policy. This is a reason people love condominiums: the exterior of the property is maintained by someone else while the interior is the owner’s responsibility. The owner of a condo unit will need to carry their own policy (referred to sometimes as a “walls in”), but that policy typically only protects what is in their unit.
Because each individual has their own policy, the owners collectively need to pay for the common areas to be covered such as the walkways, pools, hallways etc. When you’re looking for a new master insurance policy for a condo complex, there are many things to consider:
- What are the details of the master policy? What’s included?
- What is a reasonable deductible your association can agree on?
- How much coverage should you get?
- Does the policy need to have flood, wind or earthquake coverage?
- And more
If your association is in need of a new master condo insurance policy, contact the insurance experts at Heaton Bennett Insurance in Austin.
Frequently Asked Questions
What is the difference between an HOA master policy and a condo owner’s policy?
An HOA master policy is generally intended to address certain risks involving association-owned property, shared areas, and association operations. An individual condo policy is designed around the unit owner’s personal property, liability, and portions of the unit for which the owner may be responsible. The governing documents and policy terms help determine where those responsibilities begin and end.
Which parts of a condominium community can an HOA policy insure?
Depending on the policy and association structure, insurance may be available for buildings, common areas, shared amenities, association-owned property, and other community features. Texas condominium associations should review their governing documents and property details with an insurance professional when selecting coverage.
Can HOA insurance help protect board members?
Directors and officers liability coverage may be available for certain claims involving decisions made while performing board responsibilities. The circumstances covered, exclusions, and limits will vary by policy.
Does an HOA policy cover theft or misuse of association funds?
Crime or fidelity coverage may be available for certain losses involving theft, fraud, or dishonest acts. Associations should review who handles their funds and confirm the policy’s terms, limits, and requirements with their insurance agent.
How often should a condominium association review its insurance?
An association should consider reviewing its insurance regularly and after major renovations, property purchases, amenity additions, valuation changes, or updates to its governing documents. Periodic reviews can help the board identify changing risks and potential coverage gaps.