The average monthly premium for condo insurance is $506, but rates vary based on a number of factors.1
How much does condo insurance cost? good question! The average American pays $506 per month, but premiums vary quite a bit based on a number of different factors.
Let’s dive into the average condo insurance costs in the United States, along with what you can expect to pay based on where you live.
what is condo insurance?
Condo insurance (also called ho-6 insurance) provides an additional layer of coverage on top of homeowners association (hoa) insurance. protects the interior structure of your condo, including your personal belongings. It also gives you liability protection if someone is injured while on your property.
Condo insurance is a type of property insurance, like homeowners insurance or renters insurance. it’s not required by law, but most mortgage lenders and some hoas do.
how much does condo insurance cost?
The average annual premium in the United States is $506, or $42 per month.2 But the cost of condo insurance varies dramatically. Rates are based on where you live, the value and age of your condo, your deductible, coverage amounts, and things like your age and credit history. obviously, the more coverage you need, the more you’ll pay. And the lower your deductible (the amount you pay before your insurer starts contributing), the higher your premium.
average cost of condo insurance by state
To get a better idea of what you could be paying, here’s a look at the average cost of condo insurance by state. areas that have more extreme weather will generally have higher insurance rates.
cost of the average annual premium
states with the lowest average cost of condo insurance
If you live in any of these five states below, you’re in luck! You can expect to pay some of the lowest rates in the country for condo insurance. This is partly because these states are less populated than other parts of the Americas. states with higher population density typically see higher insurance rates due to rising property values in larger cities.
maryland and hawaii
states with the highest average cost of condo insurance
bad news. If you live in any of these five states, you’ll pay more for condo insurance. Florida is by far the most expensive, followed by Texas and Louisiana. this is due in part to the number of hurricanes these coastal states receive.
condominium insurance by coverage limit
In addition to where you live, your insurance premium is also based on your coverage limit. if you need a larger amount of coverage, you’ll pay more. Here’s a look at average premiums across the country based on amount of coverage.
$13,999 and under
from $14,000 to $19,999
$20,000 to $25,999
$26,000 to $31,999
$32,000 to $37,999
$38,000 to $43,999
$44,000 to $49,999
$50,000 to $74,999
$75,000 to $99,999
$100,000 and up
what determines the cost of condo insurance?
Again, how much you’ll pay is based on a few factors. While each insurance company keeps its exact formulas for setting rates a closely guarded secret, we know a lot about how condo insurance prices are determined.
first, we’ve all heard location, location, location. location matters. Where you live partially decides how much you’ll pay for condo insurance. For example, if you own a condo on the beach in Florida (okay!), you’ll pay more for insurance because of the higher risk that a hurricane-prone area entails. (And while we’re on the subject of hurricanes, you should check out hurricane insurance and flood insurance. Standard condo insurance policies won’t cover these types of disasters.)
age and credit history
Your age and credit history are also taken into account. (However, don’t rack up credit cards just to pay them off and boost your credit score.)
value and age of your condo
Insurance companies also take into account how much your condo is worth and how old it is. if it’s an older condo, expect to pay more.
deductible and coverage amounts
Like a seesaw, your monthly premium will go up or down based on your deductible. a higher deductible will mean a lower premium and vice versa. And obviously, the more coverage you need, the more you pay per month.
what does condo insurance cover?
Now, you may be wondering, what kind of benefit do I really get with condo insurance? what does it cover?
First, condo insurance is an excellent defensive strategy. If you own a condo, you need condo insurance. protects your finances from natural disasters and other unfortunate events that could hurt you financially.
This is what a standard condo insurance policy will cover:
- building (or dwelling) property coverage pays to repair structural damage to the interior of your condo (walls, floors, etc.) and fixtures
- personal items such as clothing, electronics, and furniture, up to certain limits
- personal liability pays for legal and medical expenses if someone is injured on your property or if your dog bites someone. most policies include $100,000 in liability costs.
- additional living expenses (also called “loss of use”) if you cannot live in your condo while it is being repaired
- loss assessment coverage kicks in if your master hoa insurance policy isn’t enough to cover a major event. For example, sometimes a HOA will require each condo owner to pay part of the repair or rebuilding costs. loss assessment is sometimes an add-on to a standard policy.
what does your hoa insurance cover?
In addition to your personal condo insurance, your HOA will cover certain things under a master insurance policy. this includes the exterior of your condo, shared spaces such as a pool or lobby, and liability for incidents that occur in these common areas. however, hoa insurance does not cover the inside of your condo or your things. that’s why you need your own separate policy.
There are three types of hoa insurance:
bare wall coverage
The least amount of coverage, bare walls protect the structure of your condo building, most fixtures and furnishings in common areas, and any property owned by the hoa.
single entity coverage
Sometimes called “inside wall” or “stud” coverage, this provides the same level of coverage as bare walls, but covers permanent fixtures inside individual units (things outside the walls, like cabinets).
This is the most comprehensive level of hoa insurance. It covers the entire interior of your condo, as well as any renovations and improvements you’ve made. (If your hoa is “all inclusive,” you probably don’t need homeowners coverage.)
How much condo insurance do you need?
Now that we’ve answered, how much does condo insurance cost? Let’s take a look at how much condo insurance you need.
Your condo insurance needs will depend on your specific situation, including how much your hoa insurance covers.
First, you need enough homeowners coverage to pay for interior repairs to your condo. Check with your hoa to see what is covered under your policy so you can fill in the gaps. You should also have an idea of construction costs in your area to ensure your home’s coverage is sufficient for a complete rebuild.
Next, you need enough personal property protection to replace your things if they’re lost, stolen, or damaged. And you should know the difference between actual cash value (ACV) and replacement cost coverage. With actual cash value, if your TV is stolen, your insurer will only pay what it was worth when it was stolen (considering depreciation). replacement cost coverage pays for a new television. And if you own more expensive items (collectibles, art, and jewelry), you can purchase additional coverage with higher limits.
Finally, make sure you have enough liability insurance to protect your assets if you’re ever sued or injured on your property. Lawsuits can be very expensive and you must have enough liability to protect yourself. If you have a higher net worth, you may also want to consider umbrella insurance to further increase your liability limits.
how to save on condo insurance
everyone wants to pay less for more. If you’re looking to lower your condo insurance costs, here are some tips:
1. bundle up, baby!
It’s true. Combining your condo insurance with a homeowners or auto insurance policy with the same company can really save you money. ask your insurance company or insurance agent if you can bundle and save.
2. increase your deductible.
If you have enough money saved, raise your deductible and watch your monthly premium drop like a rock in a small pond. really. Raising your deductible is an easy way to lower your monthly costs. (Deductibles are typically $500, $1,000, or $1,500.)
3. claims limit.
Your insurance company likes it when you file fewer claims. duh but sometimes they will pass those savings on to you through discounts. So the next time you’re considering filing a claim, think about whether it’s really worth it.
4. take security seriously.
Some insurance companies will offer discounts if you install better security features on your condo. so go get some locks and start saving!
5. go shopping!
Looking for better rates never hurts. you may be able to save simply by switching to a different company that can offer you a more competitive price for the same coverage.
If you really want to make sure you’re getting the best coverage at the best price, we recommend working with one of our insurance professionals who are part of our Supported Local Provider (ELP) program. they are trusted and can shop for you to find the best deal. They can also make sure you don’t end up paying for coverage you don’t need.
Just like your home, your condo is one of your biggest investments. you may have even dreamed of buying it for decades and now you finally have it! protecting that investment is a big deal. connect with an elp today and get the right coverage.