Different Insurance Needs for a Condo Association vs. Unit Owners

Different Insurance Needs for a Condo Association vs. Unit Owners

Condominium unit owners and condo associations have different needs than traditional homeowners. If you own a condo, you probably have insurance for your own unit, and the condo association will have its own insurance policy.

There are many misconceptions about the insurance needs of a condo owner and the insurance association itself. For example, some people believe that the condo association’s insurance policy is enough to fully protect them, but this is not the case. 

It’s important to understand the difference between the condo association and unit owner insurance policies in the case that something happens to your condo. Below we discuss the differences in the insurance policies between the condo association and the condo unit owner.

What is a Condo Association Insurance Policy?

Your condo association will have its own insurance policy. The condo association’s policy may be different than you expected since the condo association’s insurance needs are different than the unit owner. 

Condos differ from traditional homes because there are shared spaces like hallways, elevators, gardens, community spaces, and more. 

What Does a Condo Association Insurance Policy Cover?

The condo association’s policy will cover liability and injury to third parties and structural damage that happens in or to these shared areas. They do not cover any liability that occurs within your own condo, only in the shared community areas.

Depending on your condo’s insurance policy, they may offer a range of coverage from none to complete coverage of walls, flooring, countertops, and more in the condo. You should read up on your condo association’s insurance policy to understand what is and isn’t covered.

Your condo association’s by-laws and master deed should detail who is responsible for damage to the unit itself. Also, it is important to note that your condo association’s policy will not cover any of your personal items within the unit. To get your personal items within your condo covered, you will need a unit owner’s policy.

What is a Condo Owner’s Policy?

As detailed above, the condo association’s insurance policy will not provide you with complete coverage, so if something happens to the interior of your condo, your personal items, or there is a liability issue, you will be left without coverage if you don’t have your own policy in place.

This is why understanding your association’s policy and getting your own policy is essential. Your policy will fill the gaps in coverage and ensure that you would be covered if anything were to occur.

What Does a Condo Owner’s Policy Cover?

Your personal coverage will depend on the type of policy you buy. Below, we will outline some types of coverage that you can include in your coverage to protect yourself if anything happens to your condo, anyone inside your condo, or your personal items.

Loss Assessment Coverage

This additional coverage may protect you from paying out of pocket for a special assessment of the condo association issues for expenses associated with an insurance claim. 

For example, if the condo association needs to pay for an insurance claim, but the maximum amount the insurer will pay towards said claim, also known as the coverage limit, is too low to pay for the total cost, then the association may put that cost on the condo owners to pay. However, if you have loss assessment coverage, you may be protected against having to pay for this yourself.

Dwelling Coverage

Dwelling coverage is a common type of coverage used by homeowners and condo owners alike. Dwelling coverage protects you if there is any damage to the condo/home or attached structures. If your condo is damaged due to a storm, fire, wind, or other covered events, dwelling coverage will cover your repairs.

In addition, with condo dwelling coverage, you likely only need to cover any damage to the interior of your condo, as the association should cover any damage to the exterior.

Liability Coverage

In the case that someone is injured inside your condo, liability coverage may cover the cost of any legal or medical bills. This coverage may also protect you if you accidentally damage another person’s property; for example, you accidentally start a fire in your unit that damages another unit.

Personal Property Coverage

Your association will not cover any of your personal items within your condo. Therefore, if you value these items and would like them to be covered in the case of a fire, flood, or theft, you should purchase personal property coverage. If any of your personal items are damaged, destroyed, or lost due to a covered event, then you will be covered in the form of compensation.

Renters Insurance

If you are renting a condo from someone else, you likely don’t need any condo insurance as your landlord will have that covered. However, you may want to buy renters or tenant insurance. Renter’s insurance will cover your personal items like personal property coverage does. In addition, renter’s insurance may include liability coverage as well.


If you own a unit in a condominium, you should definitely have your own personal unit owner’s coverage. If you don’t, you may be liable for injuries and damages and will not be protected if your personal items are lost or stolen. While you may have thought that because you pay for your condo association’s insurance, you don’t need your own, unfortunately, that isn’t true. 

Understanding your condo association’s policy and filling in the gaps with your own policy is the proper way to protect yourself against loss.

If you want to learn more from an insurance team you can trust, contact Insurance Center of North Jersey.