Condo Dwelling Coverage: What Is It & How Much Coverage Do I Need?

If you’re a condo owner, you’ll generally need less insurance coverage than someone who owns a single-family home.

That’s because your condo’s HOA (homeowners’ association) shares the burden of insuring the property. Our real estate experts will elaborate about this and more in this guide below.

What Is It Exactly?

A personal condo insurance policy, also known as condo dwelling coverage, is a type of home insurance policy that will cover the cost of repairing your condo unit and replacing your possessions.

However, just like regular homeowners’ insurance, a condo insurance policy comes with certain policy limits:

Why Do I Need Condo Dwelling Coverage?

Any condo HOA will have a master policy insuring the property in case of a disaster or emergency. It is part of condo unit maintenance. This generally covers: 

pantry and living room

The HOA typically pays for the master policy using part of your and the other unit owners’ monthly homeowners’ dues. However, condo owners are responsible for insuring their own units and personal belongings.

That’s why you need to get dwelling coverage for your own unit: so that if you need to make repairs or replace your belongings, the insurance company will pay for it up to your coverage limits. 

How Much Do I Need?

Before you can calculate how much coverage to get, you need to review your HOA policy. Master policies come in three kinds:


1. Bare walls master policy: In addition to the building’s exterior and common areas, a bare walls policy covers only the bare structure of each unit: the walls, floor, and ceiling. Some bare walls in policies also cover things like plumbing and wiring systems. 

2. Single entity coverage: This covers everything a bare walls master policy does, plus built-in fixtures and appliances like cabinets and bookshelves.

3. All-in master policy: This type of coverage protects the interior AND exterior surfaces of each unit, as well as the building’s exterior and common areas.

The type of master policy your HOA has will give you a clearer idea of how much dwelling coverage you need to build into your own policy: 

signing of documents

What Should a Proper Condominium Insurance Policy Have?

A sound condo insurance policy should include the following categories:

1. Dwelling Coverage

This refers to the amount of money you’ll need to repair or rebuild your condo’s interior. This includes the walls, floor, and ceiling and attached fixtures and appliances (e.g., lights, toilets and sinks, cabinets and shelves, etc.)

To calculate how much dwelling coverage you should get, you can ask an architect or contractor to give you an estimate. They’ll appraise the value of your fixtures and appliances and estimate expenses such as:

two men talking

2. Personal Property Coverage

This refers to the amount of money it will cost to replace all your personal belongings.

To estimate how much coverage you need in this category, you need to take a detailed inventory of everything you own, which includes:

walk-in closet

There are two kinds of insurance you can get to cover your personal property:

1. Actual cash value policy: This insures your items for their current market value, even if they’ve already depreciated since you first bought them.

2. Replacement cost value policy: This gives you enough cash to replace your lost items with brand new ones of similar quality.

NOTE: Replacement value policies are more expensive upfront but more cost-efficient in the long run. With a replacement value policy, you won’t have to pay out of pocket for the price difference between a depreciated item and a brand new one.

Whichever you choose, most condo insurance policies set the personal property limit at 50% of your dwelling coverage.

3. Additional Living Expenses (ALE)

As the name suggests, additional living expenses — also called loss of use coverage — cover expenses you incur from living somewhere else if your condo becomes uninhabitable because of property damage or loss from a covered peril.

blue couch in a cozy living room

To be fully covered, it’s recommended that you purchase ALE coverage equal to the average cost of living in a similar condo for a year.

4. Medical Expenses

Since your condo’s HOA policy only covers injuries in shared areas of the building, you need to include medical expenses in your coverage.

This will cover the medical bills in case someone injures [1] themselves inside your unit.

NOTE: This will only pay for the medical expenses of someone outside your household. Otherwise, you’ll have to use your own health insurance. 

5. Liability Insurance

If someone files a liability claim against you in court — say, for an injury that occurs in your unit — this will help pay for your expenses.

two ladies talking

This can include anything from lawyers’ fees to recouping your assets if the court seizes them. To be fully covered in this category, calculate the total value of all your assets and purchase enough personal liability coverage to cover that amount.

Other Considerations

Mortgage Lender Requirements

To protect their investment, mortgage lenders generally require you to have a minimum amount of insurance coverage. For instance, many lenders require potential borrowers to have coverage for 20% of a unit’s value.

Insurance Riders

These are insurance products that you add to existing policies. Most riders add special or additional coverage for specific circumstances, like adding flood insurance or insuring high-value items like jewelry and artwork.

Loss Assessment Coverage

This will cover your expenses if your HOA policy’s payout isn’t enough to pay for damages, and condo owners are required to make up for the shortfall.

Using a Condo Dwelling Coverage Calculator

Once you’ve calculated the values you need for each category, you can plug them into an online calculator and come up with a ballpark figure.

person using laptop

While a dwelling calculator can provide a reasonable estimate, it’s always best to talk to your insurance agent to make sure your particular needs are met.

How Often Should I Update It?

It’s recommended that you update your condo dwelling coverage at least once a year for three main reasons:

1. Cost of labour and materials: If these go up, then the cost per square foot of repairing or rebuilding your unit will also go up.

2. Change in real estate values: For example, if the rent in your area increases significantly, you’ll have to adjust your ALE accordingly.

3. Added renovations: A newly renovated room or unit will, naturally, cost more per square footage to insure.

What Perils Are Usually Covered by Condo Insurance?

Most types of home insurance, including condo insurance, cover damage and loss caused only by these 16 perils:

There’s also open-perils coverage, which is more comprehensive. It protects you from all of these plus anything not specifically listed on your policy as an exclusion.

What Perils Are Not Covered by Condo Insurance?

These perils are excluded from most insurance policies:

Specific insurance policies for most of these perils do exist (e.g., flood insurance, earthquake insurance). However, they need to be purchased separately from your main policy.


Buying any kind of insurance can seem overwhelming, but it doesn’t have to be. If you follow the steps our condo and insurance specialists outlined in this article, you should easily be able to calculate how much condo insurance coverage to get.

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Tal Shelef
Tal Shelef is a know it all when it comes to pre-construction developments Canada Wide. His years of daily research and growing up on construction sites / seeing development sites grow from the ground up at an early age gave him a passion like no other. He uses his knowledge to educate Condowizard’s clients. Have a conversation with Tal and see how much value one phone call may provide you.

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