By Prerna Kapoor, CLHMS | REAL Brokerage | July 12, 2026
A client of mine in a Lone Tree townhome had a neighbor’s washing machine overflow into her unit last spring. Water came through the ceiling, ruined the flooring, and damaged cabinets she’d upgraded when she bought the place. She assumed the HOA’s master insurance policy would cover it. It didn’t, not most of it. The master policy covered the shared structure. Everything inside her unit’s walls was on her, and she found out how much of a gap that was after the fact instead of before.
What the HOA Master Policy Actually Covers (And Where It Stops)
Colorado condo and townhome HOAs typically carry one of three master policy types: bare walls, single entity, or all-in. A bare-walls policy, the most common and the leanest, covers the building’s structure down to the unfinished drywall and subfloor, plus common areas like hallways, roofs, and elevators. It stops there. Your flooring, cabinets, paint, light fixtures, appliances, and any upgrades you made beyond builder-standard finishes are not the master policy’s responsibility, no matter how the damage happened.
What an HO6 Policy Adds: Walls-In Coverage, Betterments, and Personal Property
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An HO6 policy is the individual condo owner’s policy, and it’s built to fill exactly that gap. It covers your unit from the studs in, sometimes called walls-in coverage, plus any betterments and improvements you’ve made beyond what the builder originally installed, your personal belongings, additional living expenses if the unit becomes unlivable during repairs, and personal liability if someone is injured inside your unit. Without it, a burst pipe or a neighbor’s overflow can leave you paying out of pocket for everything the master policy doesn’t touch.
Loss Assessment Coverage Is the Piece Most Owners Skip
When an HOA faces a large shared loss, storm damage to a roof, a lawsuit, or simply a big claim that pushes past the master policy’s deductible, the HOA can levy a special assessment against every owner to cover the shortfall. Loss assessment coverage on your HO6 policy reimburses you for your share of that bill, and most policies offer it in limits from $1,000 up to $50,000 or more. Given how much master policy deductibles have climbed across Colorado’s condo insurance crisis, this line item matters more today than it did even two years ago. It’s inexpensive to add and easy to skip if no one points it out.
How Much HO6 Coverage Actually Costs in Colorado Right Now
For a mid-size unit with standard personal property and dwelling coverage, expect somewhere in the $400 to $900 a year range, with the exact number driven by your unit’s value, its wildfire and hail exposure, your claims history, and how much loss assessment and walls-in coverage you add on top. It’s a modest line item compared to the cost of paying a flooring and cabinet replacement out of pocket, which is closer to what my client in Lone Tree was facing.
What to Check Before You Buy the Right HO6 Amount
Ask for the HOA’s master policy declarations page before you close, not after. It’s typically included in the HOA resale documents your seller is required to provide. Confirm whether the master policy is bare walls, single entity, or all-in, since that changes how much walls-in coverage you personally need to buy. Check the master policy’s deductible too. A higher HOA deductible means more of a shared loss could land on individual owners through a special assessment, which is exactly what loss assessment coverage is designed to catch. The same HOA reserve study that tells you whether the building is financially healthy is worth reading alongside the insurance certificate before you finalize your HO6 policy.
Quick answers
Do lenders require HO6 insurance? Yes. Virtually every lender requires proof of an HO6 policy at closing on a condo or townhome purchase, separate from whatever the HOA carries.
Is HO6 the same as renters insurance? No. HO6 includes walls-in structural coverage for the unit you own, which renters insurance doesn’t include since a renter doesn’t own the unit.
How do I find out what my HOA’s master policy covers? Request it in writing from the HOA, or ask your agent to pull it as part of the HOA resale certificate before you’re under contract.
If you’re buying a condo or townhome and want help reading the HOA’s master policy before you settle on an HO6 amount, I’m always happy to walk through it with you, no pressure, no pitch.
Prerna Kapoor | REALTOR® | Luxury Home Specialist
REAL Brokerage | 720-949-5450 | info@prernakapoor.com
CLHMS • RENE • PSA • ABR | International Sterling Society Award Winner
Prerna specializes in residential real estate across Parker, Aurora, Lone Tree, Castle Pines,
Highlands Ranch, Cherry Creek, Greenwood Village, and Centennial. She speaks English, Japanese,
and Hindi.
