Homeowner's Insurance

Virginia condo unit owner insurance: What to know

December 20, 2021

Condo unit owners enjoy the convenience of living in a community where much of the exterior repairs and maintenance are taken care of by their homeowners association. However, things can get confusing when it comes to condo insurance for unit owners.

When shopping for insurance, condo unit owners need to pay close attention to what they’re responsible for insuring and what their HOA will cover.

As a unit owner it can be difficult to understand the details of your condo’s master policy. It’s important to make sure you use an insurance agent who will be able to get their hands on the master policy so they can know where your condo’s insurance ends and yours should begin.

Because of this, we highly recommend using the insurance agency that also insures your condominium building (their insurance is also called the “master policy”). This way, you can be sure that there are no vulnerabilities in your policy and that you are properly protected.

It’s still a good idea to know about the different types of coverage options you have as a condo unit owner. This post will give you a breakdown of what condo unit owners need to know about insuring their property.

What is condo insurance?

Condo insurance, also called HO-6 insurance, should cover anything that your HOA’s master policy does not insure. The condo master policy is essentially the insurance for the building and grounds, but not your individual unit and the items inside.

HOAs usually insure common areas and the exterior of the building with their master insurance policy, but be sure to check your HOA bylaws before purchasing your own HO-6 insurance policy.

What an HO-6 insurance policy covers

Generally, you’ll need an individual condo insurance policy to cover your personal belongings, living expenses if your condo is destroyed, and personal liability if a guest is injured inside your unit. Depending on your HOA’s master insurance policy, you may also need to purchase coverage for your appliances and drywall.

Some HO-6 policies also cover improvements you make to your unit and your master policy deductible if your HOA needs to file an insurance claim.

While your condominium may have their own insurance policy, it most likely doesn't cover anything inside of your unit. That's where condo unit owner's insurance comes in.

What types of condo insurance policies are available in Virginia?

In order to know what kind of policy you need as a unit owner, you should have an understanding of the types of coverages your condominium will have. Generally, Virginia condo HOAs should purchase insurance that covers the basic building structure and common areas on the property, including liability insurance if anyone is injured in a common area, according to the Virginia Corporation Commission.

Virginia HOAs can carry a few types of master insurance policies, including:

Walls-in insurance

A walls-in HOA insurance policy typically covers the walls, floors, and ceilings inside your unit, but nothing that’s attached to them. That means your individual policy will need to cover things like carpeting, light fixtures, and appliances.

Walls-out insurance

A walls-out HOA insurance policy will not cover anything within your unit. For example, your personal insurance policy will need to cover any damage to interior drywall while your HOA’s insurance will cover damage to exterior walls and siding.

All-inclusive insurance

Your HOA’s insurance policy covers items that are built into your unit, including light fixtures and appliances. This should include any improvements you make to those items. An all-in master policy will not cover your personal belongings.

Homeowners insurance vs. Condo insurance

Homeowners and condo owners have different insurance needs. A homeowners insurance policy will cover an entire property, including detached buildings. Depending on your condo’s master policy, you might actually need a homeowners insurance policy.

Condo owners usually only need to worry about insuring their own unit and personal belongings while the HOA policy covers the building and other structures. Your HOA fees are used to pay for your condo’s master insurance policy.

Because you're not insuring a whole house (usually just the things inside your unit), condo unit owner's insurance is much more affordable than homeowner's insurance.

Condo insurance costs

The average cost of condo insurance in the U.S. is about $506 per year (as of the writing of this article in 2021).

Virginia condo owners pay $352 per year on average, or about $30 per month.

Your insurance costs depend on where you live, the size of your policy, the cost to rebuild your condo, your claims history, pets, and your deductible. Your HOA’s master insurance policy will determine how much individual insurance you’ll need to cover your property, so be sure to check your HOA bylaws before purchasing an insurance policy.

Condo unit owners may also be required to help cover deductibles of the master policy, so find out what those are and whether you’re responsible for costs before the HOA policy kicks in. Your HO-6 policy could cover this cost if it has high enough limits.

Condo Insurance FAQs

How do I know what kind of insurance coverage I need?

Condo HOAs have their own bylaws and insurance policies. Review your HOA bylaws or contact your HOA’s insurance company to get an accurate understanding of what their insurance policy covers and what you’re responsible for insuring. Typically, you can find a description of unit boundaries and condo unit owner’s responsibilities in your condo documents or HOA bylaws.

Although Virginia does not mandate how much interior coverage you have, your HOA or mortgage lender may have specific requirements for your individual insurance policy. That’s right – as a condo unit owner, your condominium may actually mandate a minimum amount of insurance coverage that you’re required to have.

Because there can be so much variation between what different condo master policies dictate, it’s important to consult a professional insurance agent who has experience insuring condos. We highly recommend using the insurance agency that insures your condo’s master policy because they will be most able to make sure you have the proper coverage.

How much condo insurance do I need?

Your condo insurance policy should be enough to cover the cost of replacing your belongings and how much you could lose if someone were to sue you. Valuable items can be insured with a rider on your existing policy or under a separate insurance policy.

You can choose insurance policies that offer actual cash value or replacement cost coverage. Actual cash value policies will pay you the depreciated value of your belongings if they’re destroyed. Replacement cost coverage is pricier, but it will pay to replace your items with new and similar items.

It’s a good idea to take a personal inventory of your belongings and their value to get an accurate idea of how much insurance you’ll need to purchase. We recommend keeping a document stored in the cloud (online) of expensive items, serial numbers, and photos of those items.

Your HOA fees go towards paying for the condominium's master policy. Even though it doesn't protect your personal items, it still protects you while in common areas such as the condo gym or pool.

How can I save money on condo insurance?

Insurance companies often offer discounts for customers who bundle multiple policies. Basic safety features in your unit like deadbolts and smoke detectors can also help you save.

You can also choose to increase your deductible to manage your monthly costs, but you will have to pay more up-front if you need to file a claim.

Who pays for the condo’s master policy?

Generally your HOA fees will help pay for the condominium’s master policy. Don’t feel too cheated, though, because their insurance policy may end up helping you. For example, if your condo building has a major utility problems, their insurance policy may help pay for the damages to your unit. Additionally, if you experience an injury on condominium grounds, you may be entitled to compensation or medical cost coverage that would be paid by their insurance policy.

Get condo unit insurance in Virginia with Shriner Insurance

Condo insurance can be tricky, but an experienced insurance agent can help you find the best HO-6 policy so your condo has the right amount of coverage.

Ronnie Shriner Insurance has proudly served residents in the Richmond, Virginia area since 1989. Based in Glen Allen, we specialize in tailored insurance plans based on each person’s specific needs, and we’re happy to help you select the condo insurance option for you.

Click here to contact us online, or email info@shrinerinsurance.com. You can also call our office at 804-270-0406.  

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