Is HO6 the same as condo insurance?

Yes! Condo Insurance is also known as an HO6 policy in the insurance industry. Insurance policies have developed over time and HO6 is the policy form used for condos and townhome associations that cover the dwelling. I.e., even if you are in a townhome with association coverage for the building you will need an HO6/condo policy.

Utah condo law changed in 2011 and under Utah Code 57-8-43 you will find the complete law and details: C57-8-S43_2014040320140513.pdf (utah.gov) https://le.utah.gov/xcode/Title57/Chapter8/57-8-S43.html

Under Section 9(b) the condo association is required to provide property insurance in:

(b)The total amount of coverage provided by blanket property insurance or guaranteed replacement cost insurance may not be less than 100% of the full replacement cost of the insured property at the time the insurance is purchased and at each renewal date

The most significant change in this law required condo associations to provide property coverage for any fixture, improvement, betterment, here is the entire paragraph:

(c)Property insurance shall include coverage for any fixture, improvement, or betterment installed at any time to a unit or to a limited common area associated with a unit, whether installed in the original construction or in any remodel or later alteration, including a floor covering, cabinet, light fixture, electrical fixture, heating or plumbing fixture, paint, wall covering, window, and any other item permanently part of or affixed to a unit or to a limited common element associated with a unit.

The law previous to 2011 was vague and only required condo associations to cover through to the paint and the individual condo owner had to cover all improvements. You can imagine the confusion with some of the claims resulting in the new law which is much clearer. If you own a condo in a state other than Utah you will need to research the law in that state to make sure you are properly covered.

When the law changed, condo associations and their insurance carriers responded with higher deductibles for association policies. The most common deductible that we see is $10,000 but every association is different and deductibles can range from $1000.00 to $100,000.00. Some association property managers publish the association deductible on the association or property manager’s website. You can also contact the property manager or insurance agency of the association to obtain a certificate of insurance which will contain the deductible.

Your individual HO6/condo policy should include enough building coverage to cover the association deductible. In addition to building coverage to cover the association deductible, here are a few other coverages your individual condo policy should cover:

  • Dwelling/building coverage
  • Personal property coverage for your furniture, appliances, clothing, electronics, etc.
  • Additional living expense
  • Liability coverage
  • Loss assessments

There are many other coverages that can be added to a condo policy to make sure you have the best protection. Call an Anderson Insurance Group agent for more details.

Most mortgage companies require and pay for an individual condo policy as part of the escrow account. All condo associations require that an individual unit owner carry condo insurance sufficient to cover the association deductible. If you are an individual condo owner and your mortgage company does not pay your insurance, you should still carry condo coverage. The cost can be as low as $20.00 per month and can be the difference between financial ruin or protection in the event of a claim.

For more details regarding condo insurance and Utah condo insurance law call or click to speak to one of our knowledgeable team members today.

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