HO6 Homeowners Insurance

A HO6 homeowners insurance policy, otherwise known as a condo insurance policy, is insurance that covers liability claims, any damage to your condo or belongings and any living expenses in the case you’re unable to live in your space due to an incident that is covered. 

Like a homeowners insurance policy, condo insurance is a must-have for anyone living in a condominium. Learn more now with Benzinga’s guide.

What is an HO6 Policy Form?

HO6 insurance policies are insurance coverages that apply to co-op or condominium owners. HO6 policies are considered property insurance and typically complement a condo association’s master insurance policy. 

These policies function in largely the same way that homeowners insurance policies do, except for the fact that they don’t cover any shared areas of areas of your property under control of the condo association, such as  a communal hallway. 

When are HO6 Policies Typically Used?

HO6 policies are used by owners of condos, co-ops, subdivisions and other types of living spaces that combine private and communal areas. Since HO6 policies complement your association’s insurance, this type of insurance provides coverage for the structure that you own, your belongings and personal liability coverage in the case someone is hurt within your residence.

These policies are typically used anytime your association’s insurance does not cover something or does not cover the full amount of the damage. Your association’s insurance will cover structures that are outside your residence, while an HO6 policy covers occurrences within the residence as well as the dwelling itself.

What do HO6 Policies Cover?

Similar to regular homeowners insurance, HO6 insurance will provide coverage for liability claims and personal losses. HO6 policies cover condominiums, as well as row homes, townhomes and subdivisions that are not technically classified as condos but also share common spaces or elements. 

The extent of your HO6 coverage will be dependent on the coverage you receive from your association’s master policy. A master policy offers coverage for general liability for the association and property damage of common areas. 

Master policies will typically be one of the following three: bare walls, single entity or all-in. Each of these have their own inclusions and exclusions of coverage. Consult with your condo association to find out which general condo coverage you have, so you can choose the right amount of coverage for your situation. 

The following coverages are usually considered standard inclusions on HO6 policies.

• Dwelling coverage: Dwelling coverage offers coverage for any improvements or alterations that are done to the residence. It also covers parts of your residence that are structural and your responsibility to insure.  
• Personal property coverage: Personal property coverage compensates you for loss and damage that occurs to your things that you keep inside your residence. 
• Loss of use coverage: Loss of use coverage helps you pay for living expenses in the event that something happens to your home that renders it inhabitable. 
• Liability coverage: Liability coverage helps you cover the cost of legal expenses or judgments that you’re ordered to pay in the event that someone is injured on your property and sues you for the cost of medical bills. It can also pay for legal expenses if someone sues you after you damage their personal property. 

Your policy may also include something called loss assessment protection. Loss assessment coverage helps cover the cost of damages to communal areas of your condo or co-op space, such as a swimming pool or sidewalk. 

In most instances, your condo association’s communal insurance policy will cover these damages. However, if the damage to the shared space extends beyond the association’s policy limits, you and other residents may be responsible for making up the difference. 

Most condo insurance policies include $1,000 worth of loss assessment coverage. However, you may also have the option to extend this coverage with a rider. This may be worth your consideration if you live in a space with many high-value communal areas. 

What Perils are Covered Under a HO6 Policy?

In the world of property insurance, perils are instances that cause damage to your living space that are covered by your insurance. If your home is damaged by a covered peril, you’re entitled to file a claim with your insurance provider. 

Your policy will specify the perils that are covered with your coverage. Some perils that are commonly covered by HO6 policies include:

• Fire and lightning
• Explosion
• Theft
• Windstorms and hail
• Falling objects
• Weight of snow, ice and sleet
• Smoke
• Vandalism

Every condo insurance policy will also include exclusions. One of the most common exclusions you’ll find on an HO6 policy is flooding. If you live in an area prone to flooding, you may need to purchase a separate flood insurance policy with its own deductible. 

Replacement Cost Coverage and HO6 Policies

Replacement cost coverage is an endorsement of coverage that you can add onto your HO6 policy. Replacement cost coverage is an upgrade from actual cash value coverage, which is a type of personal property coverage that comes standard on most condo insurance policies. 

When you have actual cash value personal property coverage, your insurance provider will compensate you for the depreciated value of your lost or damaged items at the time of the peril’s occurrence. 

In some cases, this will not afford you enough money to completely replace the item that you’ve lost with a similar model. For example, you might have purchased a computer for $500 five years ago — but when you need to use your coverage, the depreciated value of the computer might be $200. If you have actual cash value coverage, your insurance provider will offer you a $200 payout. 

With replacement cost coverage, your insurance provider will provide you with a payout that will help you cover the cost incurred to replace your damaged property with a model as similar to the original as possible. If you own a number of items that tend to depreciate in value quickly, such as electronics, you may want to consider purchasing replacement cost coverage. 

How to Compare and Get an HO6 Insurance Policy

Like with any other type of insurance, you’ll have plenty of companies to choose from when shopping for an HO6 insurance policy. The following are a few things you’ll want to consider before you purchase your policy: 

• The price: You never purchase anything without determining whether the price works for your budget, so an HO6 policy should be no different. You should get at least 3 quotes from 3 different insurance companies.
• The type of coverage: Most HO6 policies include dwelling, personal property and liability coverage, but you may need more coverage than just those. You’ll also want to consider your association’s master policy to see what is covered by that to determine what additional coverage you need. 
• The policy’s deductible: The deductible is the amount of money you’ll pay out of pocket for an incident before your insurance company offers you compensation for damage. You’ll want to make sure you’re comfortable with the deductible that the policy is offering. 

The process of getting an HO6 insurance policy is relatively similar to signing onto any other type of insurance policy. The following are the basic steps that you’ll go through when signing onto a condo insurance policy.

1. Compare HO6 policy quotes from at least 3 insurers.
2. Choose and contact that insurance company that offers you the best policy in accordance with the coverage and price you need.
3. Review the insurance policy and sign it if everything is in order.
4. Enjoy some peace of mind knowing your condo is covered.   

Compare Home Insurance

Not sure where to begin your search for homeowners or condo insurance? Consider the following recommended providers below. 

Do You Need Condo Insurance?

There is no law that requires you to have a condo insurance policy in the same way that you must have car insurance to legally operate a motor vehicle. However, even if your condo is completely paid off, you should still invest in an HO6 policy to protect yourself from financial loss. 

Begin your search for insurance by getting a few quotes from competing insurance providers — exploring multiple insurance options can help you find the coverage you need at a price you can afford. 

Frequently Asked Questions