Choosing the right home insurance can be confusing, especially when you are trying to decide between condo insurance and homeowners insurance. Both policies protect your home and belongings, but they are made for different types of properties. The coverage you need depends on what kind of home you own.
What Is Homeowners Insurance ?
Homeowners insurance is for people who own a single-family house. This type of policy is usually called an HO-3 policy. It protects the entire house, from the roof down to the foundation. It also covers attached structures like garages, sheds, or fences.
This insurance helps protect your home from common problems such as fire, windstorms, hail, and theft. It usually includes coverage to repair or rebuild your house, protection for your personal belongings, liability coverage if someone gets hurt on your property, and loss of use coverage if your home becomes unsafe to live in.
The average yearly cost of homeowners insurance is between $1,754 and $2,601. The exact price depends on things like where your home is located, how big it is, and local weather risks.
Homeowners are fully responsible for all repairs and maintenance, so having strong coverage is very important. Most banks require homeowners insurance if you have a mortgage.
What Is Condo Insurance ?
Condo insurance is made for people who own a condo unit, townhome, or co-op. This type of policy is called an HO-6 policy. It mainly covers the inside of your unit, often known as “walls-in” coverage.
This means it protects things like your floors, cabinets, fixtures, interior walls, and personal belongings. It also includes liability coverage for accidents inside your unit and loss of use coverage if you cannot stay in your condo for a short time.
The outside of the building, such as the roof, hallways, elevators, and shared areas, is covered by the condo association’s master policy. This master policy is paid for through your monthly association fees.
Condo insurance is usually much cheaper than homeowners insurance. The average yearly cost is between $445 and $656. Many condo associations require owners to carry a minimum amount of condo insurance, such as $300,000 in liability coverage. Always check your association rules to know what is required.
Coverage Breakdown: Side-by-Side Comparison
Understanding the exact differences helps prevent coverage gaps. The table below clearly shows how homeowners insurance and condo insurance compare.
| Coverage Type | Homeowners Insurance (HO-3) | Condo Insurance (HO-6) |
| Dwelling / Structure | Covers the full home, including roof, walls, and foundation | Covers interior only; exterior is covered by the master policy |
| Personal Property | Covers belongings throughout the property | Covers items inside the unit only |
| Liability | Covers injuries or damage anywhere on your property | Covers incidents inside your unit; common areas covered by association |
| Loss of Use | About 30% of dwelling limit for temporary housing | About 50% of personal property limit |
| Other Structures | Covers garages, sheds, and fences | Not included; handled by master policy |
| Loss Assessment | Rarely needed | Covers your share of common-area repair costs |
Homeowners insurance usually covers more risks for the building itself. Condo insurance mainly focuses on the inside of the unit. Neither policy covers floods or earthquakes, so you need separate insurance for those risks.
Cost Factors and Savings Tips
Condo insurance costs less because the condo association takes care of the building’s exterior. Compared to homeowners insurance, condo owners often save $1,400 to $2,000 per year.
Insurance prices depend on location, unit size, claim history, and even credit score. You can lower your premium by shopping around, bundling home and auto insurance, installing safety alarms, or choosing a higher deductible.
It is also important to review your condo association’s master policy. Some policies cover only basic walls, while others include upgrades. This helps you choose the right amount of coverage for your unit.
For a condo around 1,200 square feet, many owners choose $100,000 to $300,000 in dwelling coverage, plus matching personal property coverage. Online insurance calculators can help you get a better estimate.
When to Choose Each Policy
Choose homeowners insurance if you own a standalone house. You need full protection because you are responsible for the entire structure. Some townhomes may qualify for homeowners insurance, but you should always check the policy details.
Choose condo insurance if you live in a shared building. Most lenders and homeowners associations require it. If you have expensive upgrades, such as high-end countertops or custom flooring, you may need extra interior coverage. Some townhome owners may need special or mixed policies, so speaking with an insurance agent can help.
For example, if a fire damages a condo roof, the association’s policy pays for it. If the same fire damages your kitchen cabinets, your condo insurance pays. In a house, homeowners insurance would cover both.
Common Exclusions and Add-Ons
Both homeowners and condo insurance do not cover floods, earthquakes, normal wear and tear, or pest damage. Homeowners often add coverage for extra structures, while condo owners usually add loss assessment and improvement coverage.
You can improve your policy by choosing replacement cost coverage instead of actual cash value, adding coverage for valuable items like jewelry, or buying umbrella liability insurance for higher protection. Reviewing your policy every year helps keep your coverage up to date.
FAQ: Condo vs Homeowners Insurance
Is condo insurance cheaper than homeowners insurance?
Yes. Condo insurance usually costs between $506 and $656 per year, while homeowners insurance often costs $1,754 or more.
Does condo insurance cover the exterior of the building?
No. The exterior is covered by the condo association’s master policy.
Can I use homeowners insurance for a condo?
No. It usually creates coverage gaps and can cause claim problems.
What is the minimum condo insurance required?
Many associations require at least $100,000 in property coverage and $300,000 in liability, but lenders may require more.
How much dwelling coverage does a condo need?
Enough to cover interior walls and upgrades, usually around 20% of the unit’s value after reviewing the master policy.
Is renters insurance the same as condo insurance?
No. Renters insurance only covers personal belongings and liability. Condo owners need HO-6 insurance for interior coverage as well.
