ANSWER
For a condo, you’re generally looking for an HO-6 condo policy for your unit’s interior, belongings, liability, and loss-of-use, while the HOA carries the master policy for the building. If your condo is financed, the lender will require condo insurance, and flood damage needs separate flood coverage.
YOUR NEXT DECISION
Turn the answer into your next step
- Get the HOA master policy and deductible details.
- Ask your insurer for an HO-6 quote sized to the unit interior and belongings.
- Confirm whether flood insurance is needed for the condo’s location and financing.
- If you have a mortgage, expect the lender to require condo insurance.
What to buy for a condo
A condo owner usually needs an HO-6 policy, not a standard homeowners policy, because the unit owner insures the interior and personal coverage that the HOA’s master policy does not cover. Freddie Mac says an HO-6 is required when the master policy does not cover the unit interior or when there is a per-unit deductible.
- HO-6 typically covers the interior unit improvements, personal property, liability, and loss-of-use.
- The HOA or condo association maintains the master policy for common elements and the building structure.
- If the master policy leaves gaps in the unit interior or uses a per-unit deductible, the lender expects an HO-6 policy.
What to check before you bind coverage
Review the condo association’s master policy so you know what it already insures and what your HO-6 must fill in. Freddie Mac says the HO-6 limit should be at least enough to repair the unit back to its prior condition, or at least the per-unit deductible if the master policy has one.
- Ask for the master policy declarations and deductible terms.
- Compare the unit interior, fixtures, and improvements against the HOA coverage.
- Make sure the HO-6 limit can cover the larger of repair-to-prior-condition or the per-unit deductible.
Separate coverage you may still need
Flood damage is not typically covered by homeowners insurance, so flood insurance is separate if the property is in a flood-risk area. Arkansas says flood insurance is required by law for buildings in high-risk flood areas as a condition of receiving a mortgage from a federally regulated or insured lender.
- Flood coverage is separate from the condo policy.
- Arkansas notes flood insurance eligibility depends on NFIP participation.
- If the condo is in a high-risk flood area, check the flood requirement before closing.
Sources
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