Does My Chicago Condo Association Need Its Own Insurance or Does My Unit Policy Cover Everything?

Condo ownership in and around Chicago, IL involves multiple insurance responsibilities, including those of both condo associations and individual unit owners. These policies are designed to work together, but gaps between them can leave parties exposed to significant costs after a loss.

What the Condo Association Policy Covers

Condo associations typically carry a master policy that financially protects the building’s structure, common areas and shared systems. This includes hallways, lobbies, elevators, roofing and exterior walls. The master policy may be written on a “bare walls-in” or “all-in” basis, which determines how much of the interior the association covers. The former does not typically cover anything inside an individual unit, while the latter typically covers original fixtures, installations and built-in appliances.

What Your Unit Policy Covers

Your individual condo insurance policy, often called an HO-6, is designed to cover what the master policy leaves behind. This typically includes:

• Your personal belongings
• Interior walls, floors and fixtures you own
• Liability if someone is injured inside your unit
• Loss of use coverage if your unit becomes uninhabitable
• Improvements and upgrades you’ve made

Why the Association Still Needs Its Own Policy

Your unit policy does not extend to the building exterior, shared infrastructure or common areas, except in the case of loss assessments. Without a master policy, the association would have no coverage for damage to those shared spaces. The cost of repairs could fall entirely on unit owners collectively.

Talk to an Agent About Your Coverage

Coordinating two policies takes attention to detail. Contact Transglobe Insurance Agency to review both your unit policy and your association’s master policy so you understand exactly where one ends and the other begins.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.