Condo insurance, also known as HO-6 insurance, covers the interior and personal contents of your condo unit. Depending on the policy, most everything is insured from the inside of the walls of your unit or from the studs in, and all your personal belongings - this is why you may see on the insurance policy it state from the “studs in”.
But why do you need an HO-6 insurance policy for your condo unit if the condo association already has a master insurance policy that you a pay a percentage for? You need it because the master insurance policy most likely does not cover anything within your unit, but rather only covers areas outside of your unit. For example, the master policy covers the common areas – lobby, hallways, roof, gym and maybe even a pool if your condomonium building owns one. The master insurance policy stops at the outside of each units’ outer walls, our studs. This is where your own personal HO-6 policy would pick up and protect you from any damage that occurs in your unit.
Not only will HO-6 insurance insure damage to your unit, it will also insure you against any damage you cause to another unit. For example, if a pipe bursts in your unit or your dishwasher malfunctions and floods not only your unit, but seeps down into the unit below you, you are most likely responsible for the damage in both units. A good HO-6 insurance policy will cover the cost to repair each unit back to their original state.
Even if the master policy covered the contents within your unit, the deductible is often very high, sometimes as high as $5,000-$10,000 or more. Meanwhile, for an extra $15-25 per month, your insurance agent can setup an HO-6 policy that will cover the contents of your unit.
Like all insurance, be sure to enlist the help of your trusted local insurance agent and make sure he explains each provision of the policy and you understand each one.
