Condo Association Insurance in Massachusetts

What is Condominium Association Insurance?

Condominium owners are typically responsible for insuring the condo units that they own, but they don’t own common places -- and, therefore, generally aren’t expected to provide insurance coverage for them. Instead, condo associations are responsible for insuring common areas, and they can do so through condo association insurance policies. Although this isn’t a widely known type of insurance, many insurance companies offer policies in Massachusetts.

Condominium association insurance is designed to protect the portions of a condominium property that condo owners share. These shared areas may include everything from common walls that are between two condo units to entryways that all condo owners go through. Some other common areas and items that many policies provide coverage for are:

  • Elevators and stairwells
  • Hallways
  • Community rooms
  • Landscaping
  • Fencing

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If appropriate, a policy might also provide coverage for less common amenities, like swimming pools, business centers, fitness rooms, tennis courts and even docks. (These are just a few examples of unique amenities that a policy with the necessary terms and conditions could cover).

 

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Are There Different Types of Condo Association Insurance?

There are three main types of condo association insurance. From offering the least to most protection, they are bare walls-in, single entity, and modified single entity policies. The main difference between these kinds of policies is how much coverage they provide for condo units. 

Bare walls-in policies usually only cover the most basic elements of a condo unit. Some only cover the walls, ceiling and floor (not including any special flooring) of a unit. Others cover these things, and plumbing and electrical systems. If a condo association in Massachusetts maintains this type of policy, condo owners must insure everything else in their units, including both the fixtures and their personal belongings.

Single entity policies typically include the coverages that bare walls-in policies cover (including the electrical and plumbing systems) and standard build-outs. If a condo unit is destroyed in a covered claim, a single entity policy will usually pay for new cabinets, appliances, ceiling fans and other features that are included in all units. With these policies, condo owners are still responsible for insuring any items that they’ve upgraded, along with their personal belongings.

Modified single entity policies are also known as all-in policies. These policies generally offer even more coverage than single entity policies, normally providing coverage for upgraded features as well as standard ones. If a Massachusetts condo association has a modified single entity policy, condo owners may only have to purchase coverage for their personal possessions.

WHO PAYS FOR CONDOMINIUM ASSOCIATION INSURANCE?

Since condominium associations purchase condo association insurance policies, they generally pay the premiums associated with the policies. Most associations, however, pass the cost onto condo unit owners as part of their annual assessments, equally dividing the premiums among all owners.

Like other insurance policies, condominium association insurance policies usually have deductibles. If a condo association must make a claim, it often passes the cost of any applicable deductible onto condo owners through a special assessment. 

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How Can Condo Associations in Massachusetts Get Insurance?

For help finding condo association insurance, condominium associations should contact an independent insurance agent in Massachusetts. An agent will not only be able to get quotes from multiple insurers, but they can also explain the differences in coverages between policies. 

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Roger Butler Insurance
5 Court Street
Westfield, MA 01085
413-562-2304

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This material is for informational purposes only. All statements herein are subject to the provisions, exclusions and conditions of the applicable policy, state and federal laws. For an actual description of coverage, terms and conditions, please refer to the applicable insurance policy or check with your insurance professional. The illustrations, instructions and principles contained in the material are general in scope and, to the best of our knowledge, current at the time of publication.
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