What Does Condominium/Cooperative Insurance Cover?


If you’re buying, or own, a condo or co-op you should consider purchasing insurance to protect your investment.  How much would it cost to replace all of the upgrades made to your unit? How much would it cost to replace all of your clothing and furniture?  It can add up to tens of thousands very quickly.  An affordable condo/co-op policy could be the answer.

Condo Insurance InformationWhat’s covered?

A condominium/cooperative policy, also known as an HO-6, is a form of homeowners insurance that provides coverage in four main areas:

  1. Improvements/Betterments
  2. Personal Property
  3. Additional Living Expenses
  4. Personal Liability

It includes a broad range of coverage’s including; fire, wind, hail, theft, explosion, vandalism, water damage from pipe bursts and much more.

Improvements/Betterments coverage protects the upgrades and additions you have made to your unit. Some policies may call it building or additions/betterments coverage.  An example will explain how it works best.

“Mr. and Mrs. Insured love imported Italian marble tile, mahogany kitchen cabinets and granite countertops.  They spent $100,000 to upgrade the unit’s standard Formica countertops, the Home Depot tiles and the IKEA cabinets. It is their dream apartment.   The following week they are devastated by a fire, their unit destroyed and unlivable. “What happens now?

The condo/co-op’s association’s master insurance policy will rebuild the unit (assuming the association has insurance); however they will not replace the marble tile, mahogany cabinets or granite countertops. The standard amenities will be rebuilt by the master policy, similar to the condition prior to their upgrade.  In this case, having additions and betterments coverage of $100,000 will help Mr. and Mrs. Insured replace their upgraded amenities.  Always check the association’s master insurance policy to see what would be covered in your unit.  The master policies can vary significantly.
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Additional Living Expenses

Co-op/Condo Insurance policies will cover reasonable expenses to put you up in “similar living conditions” until your building is rebuilt or repaired.  This coverage will either have a dollar amount limit, $50,000 for example, or a time limit, like 12 months.  Be sure to check your policy and understand the limits that apply to you.

Liability coverage

Many people refer to liability coverage as “trip and fall” coverage.  While that’s true, it covers much more than that.  Liability coverage isn’t limited to just the premises.  It follows you wherever you go and gives peace of mind should you get sued- like shanking a golf ball and causing property damage or bodily injury.

How much does it cost?

That really depends… how much in additions/betterments do you need to insure?  How much “stuff” do you have?  The rate is directly related to how much additions/betterments and personal property coverage you need.  Some other rating factors include location, deductible, prior claims history and the amount of liability coverage you desire.  Condo/Co-op coverage is typically very affordable for the coverage it provides.


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About the Author

David W. Clausen is the CEO of Coastal Insurance Solutions. With over 20 years' experience and over 1 billion insured, David and Coastal Insurance Solutions are the recognized leaders in high net worth insurance. For the fifth consecutive year, David Clausen has been awarded Top Producer by Insurance Business America. David is a trusted high net worth insurance expert who’s published more than 200 articles. His articles & press releases have generated over 500K pageviews and has been featured on blogs such as Google News, Yahoo Finance, CNBC, Market Watch, Fox, The New York Times, etc. David founded Coastal Insurance Solutions in 2001 after earning a BBA from the State University of New York College at Oswego.

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Digital badge for the 2023 Insurance Agents of the Year Award, featuring intricate design elements that symbolize excellence and achievement in the insurance industry.

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