Quick Answer: Condo association insurance is the master policy a condominium association buys to protect the buildings, the common areas, and the board. In Illinois, the Condominium Property Act requires property insurance at full replacement cost, at least $1,000,000 of general liability, directors and officers coverage, and a fidelity bond once the association has six or more units. How far the property coverage reaches into each unit depends on your declaration.
What Condo Association Insurance Covers
Master Property
Insures the buildings and common elements against covered losses such as fire, wind, and hail. Your declaration decides how far it reaches into each unit: bare walls, single entity, or all-in.
General Liability
Helps pay when someone is hurt or their property is damaged in a common area, such as a lobby, stairwell, pool, or parking lot, and the association is held responsible.
Directors and Officers
Helps defend board members and the association against claims over board decisions, such as how a rule was enforced or how money was spent. Illinois requires a condominium board to carry it.
Fidelity and Crime
Protects association money, reserves included, against theft by a board member, manager, or employee. It can be extended to forgery and funds transfer fraud.
Commercial Umbrella
Adds limits above the liability policies for a serious injury claim. A common addition for communities with pools, elevators, or a large number of units.
Equipment Breakdown and Ordinance or Law
Equipment breakdown covers shared systems such as elevators, boilers, and central HVAC. Ordinance or law helps pay the added cost of rebuilding to current code, and Illinois requires it on a condominium master policy.
More on each coverage: directors and officers insurance, commercial umbrella, and our guide to D&O for Illinois board members. For every kind of community, start at HOA insurance.
Bare Walls, Single Entity, or All-In?
The biggest decision in a condo master policy is where the association's coverage stops and each owner's begins. That line is called the basis, and your declaration sets it. Get it wrong and a kitchen fire turns into an argument over who pays for the cabinets.
Bare walls. The master policy covers the structure and the common elements, up to the unfinished surfaces of each unit. Owners insure everything inside: flooring, cabinets, fixtures, and finishes.
Single entity. The master policy also covers the fixtures and finishes the developer originally installed in each unit. Owners insure the upgrades they have added since.
All-in. The broadest form. The master policy covers the original build and the improvements owners have made. It costs the most because the association insures the most.
Illinois sets a floor under all three. The Act requires the master policy to cover the units to the bare walls, floors, and ceilings, and it counts the fixtures the developer installed as common elements. Floor, wall, and ceiling coverings are not included, and the policy need not cover improvements an owner adds. Our guide to the HOA master insurance policy walks through each form.
Whatever the basis, each owner's condo unit (HO-6) policy should pick up where the master policy stops. Managing a townhome community or rental buildings instead? See townhome association insurance and property management insurance.
Send us the declaration, not just the old policy
A renewal quote that copies last year's policy copies last year's mistakes. The declaration says what the association must insure, what limits it must carry, and who pays the deductible. We start there, then check the current policy against it.
Condo Association Insurance Requirements in Illinois
Part of the program is not a choice. Section 12 of the Illinois Condominium Property Act sets what a condominium association's insurance must include.
| Coverage | What the Act requires | Source |
|---|---|---|
| Property | Insurance on the common elements and the units, including the bare walls, floors, and ceilings, for not less than the full insurable replacement cost, less deductibles. | 765 ILCS 605/12 |
| Ordinance or law | Demolition and increased cost of construction coverage, together at least 10% of each insured building's value or $500,000, whichever is less. | 765 ILCS 605/12 |
| General liability | At least $1,000,000, or more if the board judges it necessary. | 765 ILCS 605/12 |
| Fidelity bond | Required for an association with six or more dwelling units, covering the funds the association holds plus its reserve fund. | 765 ILCS 605/12 |
| Directors and officers | The board must obtain it, at a level the board finds reasonable unless the declaration or bylaws set one. | 765 ILCS 605/12 |
| Deductible | No maximum is set. The board may pay it as a common expense, assess it to the owner who caused the damage after notice and a hearing, or require the affected owners to pay it. | 765 ILCS 605/12 |
| Unit owners | The board may require owners to carry insurance for their personal liability and for damage to another unit caused by their negligence. | 765 ILCS 605/12 |
This is a summary for insurance planning, not legal advice. Your declaration and bylaws can require more than the Act does. Associations outside Illinois follow their own state's condominium act.
What lenders ask for. For a unit to qualify for a Fannie Mae loan, the master policy has to cover 100% of the estimated replacement cost with a deductible of no more than 5% of the coverage amount, and the association has to carry at least $1 million of general liability. Projects with more than 20 units also need fidelity or crime coverage (Fannie Mae Selling Guide B7-3-03, B7-4-01, and B7-4-02).
When the master policy falls short, buyers in the building can have trouble getting a conventional loan, so we check it against these rules.
What Condo Association Insurance Costs
No national or Illinois source publishes an average master policy premium. These are the ranges carriers have quoted across our own book of association business.
| Community | Typical annual premium | Per unit, per year |
|---|---|---|
| Small condominium 10 to 25 units |
$3,500 to $7,500 | $280 to $375 |
| Mid-size 26 to 75 units |
$7,200 to $15,000 | $200 to $275 |
| Mid-large 76 to 150 units |
$13,200 to $24,000 | $175 to $220 |
| High-rise 300 or more units |
$40,000 to $100,000+ | $150 to $300+ |
Carrier-quoted ranges from the Pro Insurance Group association book, for communities with adequate reserves and no significant losses in the prior three years. They are not quotes. In an April 2025 survey by the Foundation for Community Association Research, 93% of respondents said their premium rose at the last or current renewal. For more, see our guide to condo association insurance cost and the HOA insurance cost guide.
Eight things move your number, and each one is something an underwriter will ask for.
| Cost factor | How it moves the premium | What to have ready |
|---|---|---|
| Insured value | The replacement cost of the buildings is the base of the property premium. | A current replacement cost valuation or appraisal |
| Master policy basis | All-in insures more of each unit than bare walls, so it costs more. | The insurance section of your declaration and bylaws |
| Age and construction | Older buildings and wood frame construction cost more to insure than newer, fire-resistive ones. | Year built, construction type, and number of stories |
| Roof and systems | Underwriters ask about the age of the roof, plumbing, electrical, and heating. | Dates of the last roof, plumbing, electrical, and HVAC updates |
| Amenities | Pools, elevators, garages, and clubhouses add liability and equipment exposure. | A list of amenities and who maintains them |
| Claims history | Prior property and liability claims raise the price and can narrow the carriers that will quote. | Loss runs, if you have them |
| Deductible | A higher master deductible lowers the premium and shifts more of each loss to the association or the owners. | Your current deductibles, including any wind and hail or water deductible |
| Location | Rates differ by state and by exposure to wind, hail, and other weather. | The address of each building |
What we need for a condo association insurance quote
Association underwriters ask for the same items on every account. A board member or the property manager can usually pull them together in one sitting.
- The declaration and bylaws, or at least the insurance section
- Number of units, buildings, and stories
- Year built and construction type for each building
- A replacement cost valuation or appraisal, if you have one
- Dates of the last roof, plumbing, electrical, and HVAC updates
- Amenities: pool, elevators, garage, clubhouse, fitness room
- Your current policy declarations pages
- Loss runs, if you have them
- The latest budget and reserve balance, so the fidelity limit can be sized
- Who manages the association and who can sign on its accounts
What Our Clients Say
Why Condo Boards Choose Pro Insurance Group
An Agency, Not a Carrier
We are an independent agency. We work for the association and shop the market on its behalf.
Association Markets
We take your community to the carriers and programs that write associations, not just the first one that answers.
Declaration First
We read the insurance section of your declaration before we quote, so the master policy matches what it requires.
Certificates Handled
Owners and their lenders ask for proof of the master policy. We handle those certificate requests for the board.
New to the board? Read HOA insurance requirements in Illinois and the most common association claims.
Condo Association Insurance FAQ
What is condo association insurance?
Condo association insurance is the master policy a condominium association buys to protect the buildings, the common areas, and the board. Most programs combine master property, general liability, directors and officers, and fidelity coverage. Unit owners insure their own belongings and interiors on a separate HO-6 policy.
What does a condo association master policy cover?
The master policy covers the buildings and common elements, plus the association's liability for injuries in common areas. How far the property coverage reaches into each unit depends on the basis in your declaration: bare walls, single entity, or all-in. It does not cover an owner's belongings or personal liability.
What is the difference between bare walls, single entity, and all-in coverage?
Bare walls covers the structure up to the unfinished surfaces of each unit. Single entity adds the fixtures and finishes the developer originally installed. All-in is the broadest and also covers improvements owners have made. Your declaration states which one the association must carry, and owners' HO-6 policies should pick up where it stops.
What insurance does Illinois law require a condo association to carry?
The Illinois Condominium Property Act (765 ILCS 605/12) requires property insurance for at least the full insurable replacement cost, ordinance or law coverage, general liability of at least $1,000,000, directors and officers coverage, and a fidelity bond for an association with six or more dwelling units. Your declaration and bylaws can require more.
How much does condo association insurance cost?
Across our own book of association business, carriers have quoted about $3,500 to $7,500 per year for small condominiums of 10 to 25 units, $7,200 to $15,000 for 26 to 75 units, $13,200 to $24,000 for 76 to 150 units, and $40,000 to $100,000 or more for high-rises. No national or Illinois source publishes an average.
Who pays the master policy deductible after a loss?
In Illinois the Act gives the board three choices. It may pay the deductible as a common expense, assess it to the owner who caused the damage after notice and a hearing, or require the owners of the affected units to pay it. Check your declaration, and make sure owners know so their HO-6 policies can respond.
What is the difference between the master policy and an HO-6 policy?
The association buys the master policy to insure the buildings and common areas. Each owner buys an HO-6 policy for personal belongings, interior finishes the master policy does not cover, personal liability, and loss assessment. The two should line up with the basis in the declaration so nothing is insured twice or left out.
Does a condo board need directors and officers insurance?
In Illinois, yes. The Condominium Property Act requires the board to obtain directors and officers coverage, at a level the board finds reasonable unless the declaration or bylaws set one. Board members are volunteers making decisions about other people's property and money, and general liability is not built for claims over those decisions.
Is Pro Insurance Group an insurance company?
No. Pro Insurance Group is an independent insurance agency, not an insurance carrier. We work for the association, take the account to the carriers that write community associations, and place the policy with the company that fits. We write associations in Illinois and 40+ states.
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Reviewed by Neal Fusco, VP Commercial Lines
25 years in insurance, including 16 at Zurich North America in workers' compensation managed care and claims.
Illinois licensed insurance producer #18515626