Short answer: your condo association carries a master policy on the building, and you carry an HO-6 on everything inside your unit. The gap between the two is where owners get hurt, and it is different in every association because master policies range from bare walls to all in. Read your association’s certificate before you buy anything.
| What is at stake | Association master policy | Your HO-6 |
|---|---|---|
| Roof, foundation, exterior walls | Covered | No |
| Lobbies, hallways, elevators, amenities | Covered | No |
| Original fixtures and finishes in your unit | Depends on bare walls vs all in | Covers whatever the master policy does not |
| Your renovations and upgrades | No | Covered under improvements and betterments |
| Your furniture, clothing, electronics | No | Covered under personal property |
| Somewhere to live during repairs | No | Covered under loss of use |
| Injury in a common area | Association liability | No |
| Injury inside your unit, or water you send downstairs | No | Your personal liability |
| A special assessment after a big building claim | Triggers it | Loss assessment coverage, if you carry enough |
On This Page
- The two policy system
- What the master policy covers
- Bare walls, single entity, or all in
- What your HO-6 covers
- Loss assessment, the coverage owners miss
- How much liability you actually need
- Which policy pays: real scenarios
- Chicago and North Shore specifics
- What to do before your next renewal
- Common questions
The Two Policy System
A single family homeowner buys one policy. A condo owner sits inside a structure somebody else insures, which means two policies have to meet cleanly in the middle or you are exposed at the seam.
The association’s master policy protects the shared structure. Your HO-6 protects your unit’s interior, your belongings, your liability, and the cost of living elsewhere while your unit is repaired. Neither one is optional, and the boundary between them is set by your association’s declaration, not by any standard.
What the Master Policy Covers
Almost every association policy covers the same core list:
- The building envelope: roof, exterior walls, foundation
- Common areas including lobbies, hallways, elevators, and amenity spaces
- Shared building systems: plumbing mains, electrical service, HVAC infrastructure
- Liability for injuries occurring in common areas
- Association owned property such as gym equipment and grounds equipment
What varies, and what actually determines your exposure, is how far into your unit that coverage reaches.
Bare Walls, Single Entity, or All In
This is the single most important line in your association’s documents, and most owners have never read it.
- Bare walls in. The association insures the structure and stops at the unfinished surfaces. Drywall, flooring, cabinets, fixtures, and appliances are all yours. This puts the most on your HO-6.
- Single entity or original specifications. The association covers the unit as originally built, including builder grade finishes, but not anything you or a prior owner upgraded.
- All in. The association covers the unit including improvements. Your HO-6 still handles personal property, liability, loss of use, and loss assessment.
Two identical units in two different buildings can need very different HO-6 limits purely because of this clause. Getting it wrong in the bare walls direction is expensive: you discover at claim time that the drywall, the kitchen, and the flooring were always your responsibility.
Not sure which one your building uses? Send us your association’s certificate of insurance and your current declarations page. We will tell you exactly where the master policy stops and whether your HO-6 limits line up with it. Email hello@longmeadow.agency or text 847.242.1040.
What Your HO-6 Covers
Property
- Personal belongings: furniture, clothing, electronics, and jewelry up to the policy’s sublimits
- Improvements and betterments: custom cabinets, hardwood, upgraded appliances, anything past original spec
- Interior fixtures and finishes, to the extent the master policy leaves them to you
- Loss of use, meaning somewhere to live while your unit is uninhabitable after a covered loss
Liability
- Injuries to guests inside your unit
- Damage you cause to neighboring units, most often water from a dishwasher, washer, or bathroom
- Legal defense costs, which are paid in addition to your limit on most forms
- Medical payments to others, a small no fault amount that settles minor injuries without a claim
Jewelry, art, and collections deserve a separate look. Standard forms cap theft of jewelry at a low sublimit regardless of how high your personal property limit is, so valuable items usually need to be scheduled.
Loss Assessment, the Coverage Owners Miss
This one is specific to condo ownership and it is the gap we find most often.
When the association has a large claim, or a deductible bigger than its reserves, it can levy a special assessment on every unit owner to cover the shortfall. Loss assessment coverage on your HO-6 responds to your share. Policies frequently default to a token amount when the realistic exposure in a mid-sized building runs well into five figures.
Two things to check. First, whether your limit is anywhere near your share of the association’s master policy deductible. Second, whether your policy includes assessments arising from the deductible itself, since some forms exclude exactly that.
How Much Liability You Actually Need
Liability limits should be set against what you could lose, not against what makes the premium look tidy. In a stacked building, one overflowing tub can damage several units below you.
Base HO-6 liability often starts low. Raising it is one of the cheapest changes on the policy, and an umbrella sitting above your condo and auto liability is usually the most coverage per dollar available to a household. We can price the difference for you rather than guess at it here, because it depends on your carrier, your limits, and what else you insure.
Which Policy Pays: Real Scenarios
| What happened | Which policy responds |
|---|---|
| Pipe in a common wall serving the whole building bursts | Association master policy |
| Supply line under your own sink fails | Your HO-6, and your liability for units below |
| Fire damages your unit | Master policy rebuilds the structure. Your HO-6 covers belongings, upgrades, and living expenses |
| Guest slips in the lobby | Association liability |
| Guest is injured inside your unit | Your personal liability |
| Your refrigerator leaks into the unit below | Your liability |
| Storm damages the roof, association levies an assessment | Master policy for the roof, your loss assessment for your share |
| Sewer or drain backs up into your unit | Only if you carry the backup endorsement. It is not automatic |
Chicago and North Shore Specifics
- Vintage buildings. Plaster, original millwork, and dated electrical cost more to repair in kind than builder grade finishes, and replacement cost estimates routinely fall short on them.
- Winter. Frozen pipes and ice dams are the seasonal claims here. A burst pipe in a stacked building rarely stays in one unit.
- Water backup. In older Chicago neighborhoods with combined sewers, backup is a genuine risk and a genuine exclusion. See our guide to sewer backup coverage in Illinois.
- Two flats and small conversions. Buildings with a handful of units often carry thinner master policies and smaller reserves, which raises assessment risk. See insurance for two flats and three flats.
What to Do Before Your Next Renewal
- Get the association’s certificate of insurance and the section of the declaration that says what the master policy covers inside a unit.
- Find the master policy deductible and divide by the number of units. That is roughly your assessment exposure.
- Photograph every room and open every closet. Most owners underestimate personal property by a wide margin.
- List anything you or a prior owner upgraded, and price the improvements coverage against it.
- Confirm you have water backup, and check whether loss assessment includes deductible assessments.
- Set liability against your assets, then price an umbrella above it.
Send us the first two documents and we will do the rest of that list with you. We compare across the carriers we hold appointments with rather than quoting a single company, so the comparison is the product.
Common Questions
Is HO-6 condo insurance required in Illinois?
Not by state law, but effectively yes. Most mortgage lenders require it, and a growing number of associations require owners to carry it and to name the association as an additional interest. Even without either, going without leaves your belongings, your improvements, and your liability uninsured.
What does bare walls in actually mean?
The association insures the building structure and stops at the unfinished interior surfaces. Drywall, flooring, cabinets, fixtures, and appliances inside your unit become your responsibility, which means your HO-6 needs a much larger improvements limit than it would in an all in building.
Does my condo policy cover water damage from the unit above me?
Your own policy covers your damaged property, and you would typically pursue the neighbor or their carrier for your deductible. If the source is a shared building system rather than their fixture, the association’s policy is usually the one that responds.
How much loss assessment coverage should I carry?
Start from the association’s master policy deductible divided by the number of units, then add margin for an uninsured shortfall. Default limits on many policies are far below that figure. Also confirm your form covers assessments that arise from the deductible itself, because some exclude it.
Do I need flood insurance for a condo?
If your unit is above grade, building flood coverage is usually the association’s concern, though your contents can still be exposed. Ground floor and garden units are a different conversation, and sewer backup is a separate endorsement from flood entirely. See our page on flood insurance.
Coverage We Write
Longmeadow Insurance is an independent agency in Wilmette with offices across Chicago and the suburbs. If any of this applies to your situation, we can review your current policy and tell you what it actually covers.
- Condo insurance and HO-6 coverage
- Renters insurance
- Home insurance on the North Shore
- Personal insurance overview
Call 847.242.1040 or request a quote online.