The Differences between a Condominium Master Policy and HO6 Policy
A condo complex is typically made up of two components, the common structures of a dwelling that is accessible to everyone and the units that are owned by individuals. Two different policies, the condominium master policy and HO6 policy, cover the spaces and it’s important to know where coverage for one begins and the next ends.
Condominium master policies can be compared to swiss cheese. The most basic of policies addresses general liability for the association and property damage to common areas. They are not named perils insurance policies, but the HO6 policy is. This means the policy lists all perils it will insure. If it’s not on the list, it’s not covered. The HO6 policy will cover claims caused by the following 16 perils:
- Fire and Lightning
- Windstorm or Hail
- Explosion
- Riots and Civil Commotion
- Aircraft
- Vehicles
- Smoke
- Vandalism or Malicious Mischief
- Theft
- Volcanic Eruption
- Falling Object
- Weight of Ice, Snow or Sleet
- Accidental Discharge or Overflow of Water or Steam
- Sudden & Accidental Tearing Apart, Cracking, Burning or Building
- Freezing
- Sudden & Accidential Damage from Artificially Generated Electrical Current
At H&K Insurance, we offer an all risk HO6 policy. The all risk policy covers everything except what is specifically excluded and can be obtained at minimal cost. This is a more comprehensive option and is a much better option for you as the insured.
Where the covered loss takes place will determine whether the claim is filed under the condominium master policy or HO6 policy. Smoke erupting in a common area, such as a lounge or mail room, would be the responsibility of the association to fix. If a fire erupts in a unit, causing damage to personal property, that portion of the claim would be covered under the HO6 policy. As far as the interior of the unit, that question can be determined by the type of coverage offered under the condominium master policy documents.
Picking the Right Coverage
Condominium master policies have the choice between offering bare-walls insurance coverage, all-in coverage, or single entity coverage to their tenants. The bare-walls coverage essentially leaves the unit owner responsible for all damage to the unit, including sinks, built-in cabinets, appliances, flooring and wallpaper. The all-in coverage, which is far more comprehensive, includes fixtures in the individual units and any structural improvements, betterments, or additions made by the unit owner. This approach leaves the tenant only responsible for personal property. The single-entity approach covers fixtures minus improvements and betterments made to the unit.
Before filing a claim, it’s important to know who is responsible for what type of damage. This will expedite the claims process and make it easier to return to smooth operation.
To obtain or make changes to an existing condominium master policy or HO6 policy, contact us at 617-924-5600.
