Reviewing association insurance without assuming it covers all unit property
Understand the limitations of your condo association's master insurance policy and why individual unit coverage is necessary for your personal property.
The short answer
Condo associations must maintain property, general liability, and fidelity insurance. However, the association's policy typically covers common elements and the building structure, not your personal property or interior upgrades. Do not assume the master policy provides full protection for your unit; always review the policy scope and obtain your own insurance for personal property and interior finishes.
Master Policy Coverage Scope
The association is required to carry commercial general liability insurance of at least $1 million and property insurance for the building. This coverage is designed for the benefit of the association, primarily protecting the common elements for which the board has legal standing.
Limits of Association Insurance
Association policies often exclude individual unit interiors, such as your personal flooring, appliances, or wall finishes. If a pipe bursts and damages your belongings, the association's master policy likely will not cover your costs. Relying solely on the association is a common gap in owner risk management.
The Importance of Individual Coverage
You are generally responsible for maintaining insurance for your specific unit. This should cover personal liability, property damage to your unit's interior, and your personal assets. Speak with an insurance professional about an 'HO-6' policy, which is tailored for condo owners.
Insurance Review Methodology
Use this method: Request a certificate of insurance from the management company. Compare their coverage limits against your own policy. Document exactly where the association's coverage ends and where your personal unit coverage begins to ensure no gaps remain in your protection plan.
Checklist
- Request the 'Certificate of Insurance' from your association.
- Read the master policy to identify covered vs. excluded areas.
- Verify the association's liability insurance meets state requirements.
- Consult an agent to confirm your policy complements the master plan.
- Document any high-value upgrades in your unit for your insurer.
Common questions
If the common lobby is damaged, does my insurance pay?
No, the association's master policy is intended to cover common elements. Your personal insurance policy is for your individual unit and liability.
How do I know what the master policy excludes?
Review the master policy documentation provided by your board. If specific exclusions are unclear, ask the management company or your insurance provider to summarize the master policy's coverage gaps.
Sources
- CFPB — Closing Disclosure explainerChecked October 12, 2026
- Illinois Residential Real Property Disclosure ActChecked October 12, 2026
- Illinois Condominium Property Act — 2025 editionChecked October 12, 2026
- SQFT IO — Listing plans and termsChecked October 12, 2026
This guide is general educational content from SQFT IO, prepared with AI assistance. It is not legal, tax or loan advice. Talk with a licensed attorney, tax professional or lender about your situation. SQFT IO Illinois license 478.027617.