Buying a condo comes with a to-do list, and insurance is near the top. Your lender and HOA will likely require it, but beyond being obligatory, a good HO6 policy is what stands between you and some genuinely expensive surprises.
If you’re new to condo insurance, here’s everything you need to know about what it covers, how it works, and how much you actually need.
TL;DR
- Condo insurance (HO6) covers your unit only, not the building. That’s your HOA’s job.
- A standard HO6 policy includes five coverage types: dwelling, personal property, loss of use, personal liability, and medical payments to others.
- Your HOA’s master policy covers the building and common areas, but if a claim exceeds that limit, the shortfall gets divided among unit owners.
- High-value items like jewelry, art, and cameras need Extra Coverage (scheduled personal property) for full protection.
- How much coverage you need depends on your property’s value, your state, your deductible, and any gaps in your HOA’s master policy.
What does my condo insurance cover?
Condo insurance protects you, your unit, and your belongings against a range of named perils, including fire, lightning, windstorms, theft, and vandalism. A standard HO6 policy includes five types of coverage: dwelling, personal property, loss of use, personal liability, and medical payments to others.
The key difference from a standard homeowners policy (HO3): condo insurance is “walls in.” You’re covered for damage inside your unit. The building itself, the exterior, and common areas are covered by your HOA’s master policy.
| Coverage type | HO3 homeowners insurance | HO6 condo insurance |
|---|---|---|
| Dwelling | Entire house and attached structures | Unit only |
| Personal property | Yes | Yes |
| Loss of use | Yes | Yes |
| Personal liability | Yes | Yes |
| Medical payments to others | Yes | Yes |
One thing to keep in mind: if you leave your condo unoccupied for more than 30 days, certain claims may not be covered. Check your policy terms before an extended trip.
Dwelling coverage
Dwelling coverage applies to your unit’s interior, including fixtures, appliances, and any renovations or upgrades you’ve made. If your pipes burst and damage your kitchen cabinets, your HO6 policy covers the repair costs after your deductible.
What it doesn’t cover: flood damage. If your ground-floor unit floods due to external water, a standard HO6 policy won’t apply. You’d need a separate flood insurance policy for that.
Personal property coverage
Personal property coverage protects your belongings inside and outside your condo. If a fire destroys your furniture, your policy covers replacement costs up to your selected limit. If your phone gets stolen on the subway, that’s covered too.
To make sure your limit is accurate, do a home inventory. Go room by room, list everything you’d want to replace, and note the replacement cost for each item. It’s the only reliable way to know if your default coverage is enough.
Loss of use coverage
If a covered peril forces you out of your condo, loss of use coverage pays for the extra costs you incur while displaced, including hotel stays, temporary rentals, restaurant meals above your normal food budget, and additional transportation.
For example: if you normally spend $5,000 a month on housing and food, but you’re spending $6,000 during displacement, loss of use coverage bridges that $1,000 gap, up to your policy limit.
Personal liability coverage
Personal liability coverage protects you if someone is injured in your condo and decides to sue. It covers your legal defense costs and any damages you’re found responsible for.
If your Aunt Martha trips over a shoe in your hallway and breaks her arm, personal liability coverage handles the legal and financial fallout.
Medical payments coverage
Medical payments coverage pays for a guest’s medical bills if they’re accidentally injured in your condo, regardless of fault. So even if Aunt Martha doesn’t sue, her medical bills are still covered under this part of your policy.
Note: this coverage does not apply to your own injuries. That’s what health insurance is for.
Real-world condo insurance claim scenarios: what’s covered and what’s not
Water damage from a neighbor’s unit
Your upstairs neighbor’s washing machine hose fails overnight, sending water through their floor and into your ceilings, walls, and hardwood floors.
| Covered: | Your HO6 dwelling coverage applies to the structural damage inside your unit. Personal property coverage applies to any furniture or electronics damaged by the water. You pay your deductible; your insurer covers the rest up to your policy limit. |
| Not covered: | If the water came from an external flood source rather than a plumbing failure, standard HO6 coverage doesn’t apply. You’d need a separate flood insurance policy. |
A guest is injured on your balcony
A friend visiting for dinner slips on your wet balcony and fractures their wrist.
| Covered: | Your personal liability coverage helps pay for their medical bills and any legal defense costs if they decide to sue. Your medical payments coverage can also pay their immediate medical expenses directly, regardless of fault. |
| Not covered: | Your own injuries are not covered under either liability or medical payments coverage. That falls under your personal health insurance. |
Theft of personal property outside your condo
Your laptop is stolen from a coffee shop while you step away.
| Covered: | Even though the theft happened off-premises, your personal property coverage still applies. HO6 policies typically extend protection to your belongings anywhere. You’d file a claim up to your coverage limit after paying your deductible. |
| Not covered: | High-value electronics may be subject to sub-limits under a base policy. If your laptop exceeds those limits, a scheduled personal property endorsement (Extra Coverage) ensures full replacement value without depreciation. |
Your HOA special assessment exceeds the master policy limit
A fire damages the building lobby and rooftop. The total repair cost exceeds your HOA’s master policy limit by $200,000, so the HOA issues a special assessment, dividing the shortfall among all unit owners.
| Covered: | Your loss assessment coverage helps cover your share of the shortfall, up to your elected limit. Lemonade condo policies include $1,000 of loss assessment coverage automatically, with options to purchase up to $100,000 in most states. |
| Not covered: | Any amount exceeding your elected loss assessment coverage limit would be your responsibility out of pocket. |
You’re temporarily displaced after a building fire
A fire breaks out in another unit and renders your entire floor uninhabitable for six weeks.
| Covered: | Your loss of use coverage pays for the difference between your normal monthly expenses and the higher costs of living elsewhere, including hotel stays, meals, and additional transportation. If your normal monthly expenses are $3,500 and you’re spending $5,000 during displacement, loss of use coverage helps cover that $1,500 gap, up to your policy limit. |
| Not covered: | Costs that don’t exceed your normal living expenses are not reimbursable. Loss of use covers the difference, not your total living costs while displaced. |
Common condo insurance exclusions
A standard HO6 policy doesn’t cover everything. Common exclusions include:
- Flood damage. Water entering from outside the building due to natural flooding requires a separate flood insurance policy.
- Earthquake damage. Seismic damage typically requires a separate earthquake endorsement.
- Prolonged vacancy. If your unit is unoccupied for more than 30 days, certain claims may be denied. Policies vary, so check yours before an extended absence.
- Mechanical or electrical breakdown. A base HO6 policy won’t cover a dishwasher or HVAC unit that fails due to age or mechanical failure. Lemonade’s Equipment Breakdown Coverage addresses this gap.
- Intentional damage. Damage you cause deliberately is never covered.
- Normal wear and tear. Gradual deterioration over time is a maintenance issue, not an insurable event.
Some add-ons to consider
Lemonade offers Extra Coverage (scheduled personal property coverage) for high-value items like jewelry, fine art, cameras, musical instruments, and bicycles. A base policy covers these items under standard personal property coverage, but Extra Coverage adds protection for scenarios like accidental damage or loss that aren’t included in a standard policy.
For example, while you’d be covered for water damage if a mechanical failure caused your dishwasher to explode all over your kitchen, a base policy wouldn’t cover the replacement of the dishwasher itself, because it doesn’t cover mechanical or electrical failures. With Lemonade’s Equipment Breakdown Coverage, however, your dishwasher and other appliances, flat-screen TV, AC, computer, and more would be covered even for electrical failure or mechanical breakdown.
Condo insurance VS. homeowners insurance
Condo and homeowners insurance share the same core coverages, but they differ significantly in what they protect structurally.
| HO6 Condo insurance | HO3 homeowners insurance | |
|---|---|---|
| What’s covered structurally | Your unit only (walls in) | Entire dwelling, exterior, and attached structures |
| Other structures | Not covered | Covered (garage, gazebo, fence, etc.) |
| Common areas and building | Covered by your HOA’s master policy | Not applicable |
| Personal property | Yes | Yes |
| Loss of use | Yes | Yes |
| Personal liability | Yes | Yes |
| Medical payments to others | Yes | Yes |
| Best for | Condo and co-op owners | Single-family homeowners |
Certain damages or incidents in your condo building or common areas would likely be covered by your HOA’s master policy. See below for more details.
What does my condo association or HOA’s insurance policy cover?
Your HOA’s master policy covers the building itself, common areas, and the land it sits on. It does not cover your unit’s interior, your personal belongings, or your personal liability as a unit owner.
If someone is injured in a common area and successfully sues the HOA, any damages above the master policy’s limit get divided among unit owners. That’s where loss assessment coverage comes in.
Loss assessment coverage protects you when damage to shared building areas or HOA liability exceeds the master policy limit. Lemonade includes $1,000 automatically, with options to add up to $100,000 in most states.
How much condo insurance do I need?
The amount of condo insurance you need depends on the value of your personal property, your state, your home’s age, your deductible, and your chosen coverage limits.
It’s also worth reviewing your HOA’s master policy carefully. Understanding exactly what it covers and where it stops helps you identify the gaps your HO6 policy needs to fill.
Personal liability exposure matters too. If you have a dog, host guests frequently, or have a balcony, those factors should inform how much liability coverage you carry.
Lemonade’s condo policies are highly customizable, so it’s straightforward to build a policy that fits your specific situation.
Before we go…
Condo insurance isn’t the most exciting part of owning a unit, but getting it right protects the investment you worked hard to make. Your HOA’s policy covers the building, not your unit, so your HO6 policy is what fills that gap. A home inventory is the only reliable way to set an accurate personal property limit, and it’s worth taking the time to do one.
If your HOA’s master policy has a low limit, check your loss assessment coverage so you’re not on the hook for a significant share of a major claim. When it comes to personal property coverage, replacement cost value pays out significantly better than actual cash value when you need it. And if you have high-value items or appliances worth protecting, Extra Coverage and Equipment Breakdown Coverage are worth asking about. Ready to see what the right coverage looks like for your unit? Get a quote with Lemonade in minutes.
Condo insurance FAQs
What does condo insurance cover?
Condo insurance (HO6) covers five areas: dwelling (your unit’s interior, fixtures, and upgrades), personal property, loss of use, personal liability, and medical payments to others. It protects against named perils like fire, lightning, windstorms, theft, and vandalism.
What is the difference between condo insurance and homeowners insurance?
Condo insurance (HO6) covers only your individual unit, a “walls in” policy. Homeowners insurance (HO3) is a “walls out” policy covering the entire dwelling structure, exterior, and attached structures. Both include personal property, loss of use, personal liability, and medical payments coverage.
Does condo insurance cover water damage from a neighbor's unit?
Yes, in most cases. If a pipe bursts in your upstairs neighbor’s unit and water damages your ceilings, walls, or belongings, your HO6 dwelling and personal property coverage can help pay for repairs, subject to your deductible and policy limits. Flood damage from external sources is not covered under a standard HO6 policy.
What is loss assessment coverage in condo insurance?
Loss assessment coverage protects individual condo owners when damage to shared building areas or HOA liability exceeds the limits of the HOA’s master policy. The remaining costs are divided among unit owners. Lemonade condo insurance includes $1,000 of loss assessment coverage automatically, with options to purchase up to $100,000 in most states.
What does loss of use coverage pay for in a condo policy?
Loss of use coverage pays for the extra costs you incur when a covered peril forces you out of your condo, including hotel stays, temporary rentals, meals above your normal food budget, and additional transportation. It covers the difference between your normal living expenses and what you’re spending while displaced, up to your policy limit.
What is not covered by condo insurance?
Standard HO6 exclusions include flood damage, earthquake damage, mechanical or electrical breakdown, intentional damage, normal wear and tear, and losses that occur during extended vacancy of more than 30 days. Separate policies or endorsements are available to cover some of these gaps.
A few quick words, because we <3 our lawyers: This post is general in nature, and any statement in it doesn’t alter the terms, conditions, exclusions, or limitations of the policies issued, which differ according to your state of residence. You’re encouraged to discuss your specific circumstances with your own professional advisors. The purpose of this post is merely to provide you with info and insights you can use to make such discussions more productive! Naturally, all comments by, or references to, third parties represent their own views, and Lemonade assumes no responsibility for them. Coverage may not be available in all states. Please note that statements about coverages, policy management, claims processes, Giveback, and customer support apply to policies underwritten by Lemonade Insurance Company or Metromile Insurance Company, a Lemonade company, sold by Lemonade Insurance Agency, LLC. The statements do not apply to policies underwritten by other carriers.
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