If you’re buying a condo in Boston, at some point in the process your lender or your attorney will tell you that you need an “HO-6 policy.” Most buyers hear this for the first time about two weeks before closing, Google it in a hurry, and end up more confused than when they started.
Here’s the plain-English version.
The Two Policies Every Condo Has
Every condo building carries a master insurance policy, purchased by the condo association and paid for through your monthly condo fee. It covers the building itself: the roof, the exterior walls, the common hallways, the elevator, the lobby.
The master policy does not cover everything inside your unit, and it does not cover your belongings. That’s what your own HO-6 policy is for.
Where exactly the master policy stops and your responsibility begins depends on the type of master policy your association carries, and this is the part that trips people up.
“Walls-In” vs. “All-In”: Read Your Master Policy First
Master policies generally come in two flavors:
Bare walls (or “walls-in”) coverage. The master policy covers the structure only up to the bare walls, floor, and ceiling of your unit. Everything inside, including cabinets, countertops, flooring, bathroom fixtures, and sometimes even interior walls and built-ins, is your responsibility to insure.
All-in (or “single entity”) coverage. The master policy covers the unit as originally built, including standard fixtures and finishes. You’re typically only responsible for your personal property, your improvements and upgrades, and your liability.
This distinction can mean a difference of tens of thousands of dollars in the dwelling coverage you need. In older Boston buildings, and especially in smaller self-managed associations in neighborhoods like South Boston, Dorchester, and East Boston, bare-walls policies are common. In newer full-service buildings, all-in is more typical. Don’t guess. Ask the management company or your attorney for the master policy declarations before you buy your HO-6.
What an HO-6 Policy Actually Covers
A standard HO-6 policy has several parts:
Dwelling coverage (Coverage A). This insures the interior of your unit that the master policy doesn’t: flooring, cabinets, fixtures, and any renovations you or a previous owner made. If you gutted the kitchen and put in $60,000 of upgrades, the master policy almost certainly doesn’t cover them. Your HO-6 should.
Personal property. Your furniture, electronics, clothing, and everything else you’d take with you if you moved. Most policies cover personal property anywhere in the world, so your laptop is covered whether it’s stolen from your unit or from your car.
Loss of use. If a covered loss makes your unit unlivable, this pays for temporary housing. In the Boston rental market, do not skimp here.
Personal liability. If your bathtub overflows and damages the unit below you, or a guest is injured in your unit, this is the coverage that responds. Water damage claims between stacked units are among the most common condo claims we see.
Loss assessment coverage. This is the sleeper. If the building suffers a major loss and the master policy limits fall short, or the loss falls under the master policy’s deductible, the association can assess every owner for a share of the cost. Loss assessment coverage picks up your share, and it’s inexpensive to increase. Many master policies now carry water damage deductibles of $10,000, $25,000, or more, and associations routinely pass those deductibles to the unit owner who caused the loss. Your HO-6 can be structured to respond to that.
What the Master Policy Deductible Means for You
This deserves its own section because it’s the most common unpleasant surprise in condo ownership. Say a pipe in your unit leaks and causes $20,000 in damage to the building, and the master policy carries a $25,000 water damage deductible. The master policy pays nothing, and in many associations the bylaws make you, the owner of the unit where the leak originated, responsible for the full amount.
When we quote an HO-6 for a buyer, we ask for the master policy’s deductible schedule and make sure the dwelling and loss assessment limits are set with that number in mind. If your current policy was written without anyone looking at the master policy, it’s worth a review.
What HO-6 Policies Typically Don’t Cover
No standard HO-6 covers flood damage from rising water; that requires a separate flood policy, which is worth a conversation for units in low-lying areas near Boston Harbor or along the Charles. Sewer and drain backup coverage is usually an inexpensive add-on and is strongly recommended in older buildings. And valuables like jewelry, art, or high-end bikes have sub-limits on a standard policy, so schedule them separately if they matter to you.
How Much Does an HO-6 Cost in Boston?
Less than most buyers expect. Premiums vary with the building, your coverage limits, your deductible, and your claims history, but an HO-6 is typically one of the smaller line items in the cost of owning a condo, often a few hundred dollars a year. Bundling it with your auto policy usually brings both premiums down.
The Bottom Line
Before you close on a Boston condo, get a copy of the master policy, find out whether it’s bare-walls or all-in, note the deductibles, and have your HO-6 written to fill the actual gap rather than a generic one. It’s a fifteen-minute conversation that can save you a five-figure headache.
Have a closing coming up, or not sure what your current HO-6 actually covers? Reach out to us at Titan Insurance and we’ll review the master policy with you and quote the coverage to match.
