Home Buying in San Francisco>Question Details

awedree, Home Buyer in San Francisco, CA

is insurance included in HOA fees?

Asked by awedree, San Francisco, CA Thu Jun 27, 2013

Help the community by answering this question:


The short answer is often not as accurate as the more detailed answer.
The short answer is YES, because HOA dues normally will include the cost of whatever insurance
the HOA Board has decided to purchase.

The more accurate answer is Yes and No, because unless you read and understand the HOA's CR&Rs, you won't know what the HOA is required to insure, and what you as a unit owner are required to insure individually.

Most HOA insurers policies say they will cover the inside of your unit excluding your Personal Property IF the CC&Rs require them to, but many if not most CC&R's are not written that way. It's
common to read that unit owners are responsible for the interior of their unit (think "build-out of an empty shell), their Personal Property, their Loss of Use, and their Personal Liability. Having your
own HO6 policy allows you to choose those limits your want, as well as meet your lender's requirements (lenders often require more than you may want to buy for "built-in" items. Having your own policy allows you to make a claim and settle it with your own insurer independently from whatever decisions the HOA Board is making to repair the building. Having the coverage all with
one insurer make help them coordinate on a claim, but it really shouldn't matter.

The biggest mistake most of us make is not buying enough. Whether it's the HOA itself, or us as
individual unit owners with our HO6. I live on commissions, but I'm saying this out of experience,
not a desire to sell more. Most of us just don't like paying insurance premiums for coverage we
tend to never use. There's a trade off in our minds between what we need, and what we want. We
want it all, and we know we can't afford it all. The difference is while any clothes in your closet that will protect you wearing the wrong clothes for an event hopefully would only be embarrassing, but
failing to buy the right kind and amount of insurance will be financially devastating IF the worst case
scenarior happens to you. When bad things happen, they are often someone else's fault. but not
always. And if that someone else turns out to be YOU, not only is everything you've worked for on the line, but everything you haven't yet inherited or earned!

Call me if you want to get this right.
0 votes Thank Flag Link Mon Jul 8, 2013
You will need to contact your HOA for specifics. For example, if a water pipe breaks and destroys your things, it will most likely not be cover.
0 votes Thank Flag Link Fri Jul 5, 2013
You must get a policy for your belongings (furniture, clothing), fire, theft and most especially, liability. Your refrigerator, washer & dryer (if in your unit) are considered personal property so you would need to include them in your coverage. I said must because I am very conservative and feel this type of insurance is necessary. However, it is voluntary (unless required by your lender.)

Good luck!

0 votes Thank Flag Link Thu Jun 27, 2013
As with a single family dwelling, the homeowner has to obtain his/her own homeowners policy, which covers the homeowners interest in the property. At the same time, the HOH has to insure those areas not covered by the collective homeowners. The homeowners include the cost of this insurance in the HOA fees.
0 votes Thank Flag Link Thu Jun 27, 2013
George's answer is spot on. HO6 is often referred to as "walls in" and is most often paid by the home owner separate from the HOA dues. The building fire/hazard insurance which is usually paid via your HOA dues is often referred to as "walls out". Literally if it is sticking out of the wall - like a faucet, that is on you or your HO6 policy, whereas the plumbing to your wall is part of the building insurance. HO6 can also cover your personal items similar to renters insurance. But again, as George mentioned, HO6 is not commonly found in your HOA dues - and Increasingly lenders are demanding that borrowers get an HO6 policy, so be aware of that as a possible extra cost when condo shopping, and lender shopping.
0 votes Thank Flag Link Thu Jun 27, 2013
HOA Dues for private home include insurance for the common areas. This information is usually available by contacting the HOA. Condo associations will usually include some degree of protection for the condo but this is on a case by case basis.
0 votes Thank Flag Link Thu Jun 27, 2013
Great question! Typically there is a blanket policy that covers the entire building and is usually built into the Monthly HOA dues. However on smaller buildings such as 2 units it depends on how the co owners arrange the payment. Some have monthly dues in plae that cover it and some jay split it half. So yes, in most cases insurance is covered in the HOA Dues.

The insurance typically covers the exterior and common areas. An additional policy called an HO6 policy is sometimes required by a lender or is advised to get as a home owner. This policy covers the interior of your specific unit.

If you have further questions or would like assistance give ma a call at 415.336.8181 or email langford@climbsf.com

Happy house hunting!

George Langford - Associate
Climb Real Estate
0 votes Thank Flag Link Thu Jun 27, 2013
Usually building insurance is included in HOA fees as are all common expenses, but not on each apartment/condo. You would need to get your own owner's or renter's policy.
0 votes Thank Flag Link Thu Jun 27, 2013
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