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Like standard homeowners insurance, a condo insurance policy offers financial relief if the policyholder’s personal property and belongings are damaged or destroyed by a covered event. This type of insurance also provides liability protection if a guest is injured in the home or if the policyholder is found legally responsible for damages themselves. However, it differs from traditional homeowners insurance in that it likely does not cover damage to the building’s structure, including the roof, hallways, and common spaces such as a parking garage. Generally, the condo association will purchase insurance to cover the physical structure of a condominium building.
Lenders will likely require condo owners to purchase condo insurance to qualify for a mortgage, but the best condo insurance is still a good idea even if condo owners buy their property without the help of financing since it can help pay to replace or repair damaged property. Knowing what a condo policy covers and how much coverage is needed will help in the process of choosing the right homeowners insurance for condo owners.
- BEST OVERALL: State Farm
- RUNNER-UP: Allstate
- BEST POLICY OPTIONS: Amica
- BEST FOR SERVICE MEMBERS: USAA
- ALSO CONSIDER: Lemonade
What to Consider When Choosing One of the Best Condo Insurance Companies
When searching for condo insurance coverage, condo owners may want to focus on insurance companies that offer coverage in the area where the condo is located, high coverage amounts to reduce out-of-pocket payments, and different insurance options to customize a condo insurance policy. In addition, it may be a good idea for condo owners to look for companies that offer a good range of discounts and deductible options in order to find a policy that is affordable.
Service Area
Just as they might if shopping for homeowners insurance, condo owners will likely want to start by looking for condo insurance companies that actually offer condo insurance policies in their particular area. Many national companies offer condo insurance across the country, but even within the same state, coverage may not necessarily be available in every ZIP code. When condo owners are shopping around and comparing rates, this is an extremely important factor to consider with every insurance provider. If the company doesn’t offer insurance in the area where the home is located, condo owners can mark it off the list and move on to the next company. This will save a lot of time during the search for the best condo insurance company to meet a condo owner’s needs.
Coverage Amount
If policyholders have to file a claim on their condo insurance, they don’t want to find out they didn’t purchase enough coverage after it’s too late. Having too low a coverage amount could result in having to pay out of pocket to satisfy a liability claim or to repair or replace covered belongings. In terms of loss of use coverage, which helps pay for living expenses in the event the condo is left uninhabitable after a covered incident, policyholders could wind up paying some of those expenses on their own if their coverage limit is too low. Therefore, it’s important for condo owners to consider the value of their assets to ensure they have adequate liability coverage and take a full inventory of all personal property and determine the value of those items should they need to be replaced after a covered loss. Knowing how much insurance they need will help condo owners determine the coverage they need with their condo insurance policy.
Policy Options
While condo insurance typically offers standard coverage for replacing or repairing personal property, each policy may operate differently. For instance, one company may offer to replace personal belongings based on their actual cash value. That means the company will pay the item’s depreciated value, not the amount it will cost to buy a brand-new replacement. If policyholders want their insurance company to pay out the amount it would cost to purchase a new item after a covered loss, they will need replacement cost coverage, which may only be available as an extra endorsement.
Condo owners who live on the first floor or have a basement unit may also be interested in water backup coverage, which could help pay for certain types of water damage that otherwise wouldn’t be covered by a standard condo insurance policy. Some companies may offer this coverage as a standard term with every policy, while others may only offer it as an add-on endorsement. When shopping for the best condo insurance, it’s a good idea to ask insurance agents about all available policy options to get the right coverage.
Insurance Premiums
Insurance premiums are the payments the policyholder makes to their insurance company in exchange for coverage. Insurance rates can vary based on a number of factors, including where the condo is located, the age of the condo, the type of condo insurance purchased, the amount of coverage included, and the policyholder’s claim history. Generally speaking, the more coverage purchased, the higher the insurance premiums. Similarly, if a condo is located in what the insurance company determines to be a high-risk area for covered perils such as theft, the insurance premiums often will be higher. Deductibles—the policyholder’s out-of-pocket expenses when filing a claim—also can affect insurance premiums. A lower deductible will often result in higher insurance rates, while selecting a higher deductible will likely lead to lower premiums.
Quote Process
The cost of condo insurance plays a key role in any policyholder’s purchase decision, especially if they want to pay the lowest rate possible. To provide an idea of how much a policy will cost, many condo insurance companies offer condo insurance quotes online. When using an online quote tool, policyholders will often need to provide certain information such as the age and location of the condo, along with basic coverage options and any extra add-on terms they wish to purchase. The tool then provides an estimated rate for condo insurance costs based on the customer’s coverage choices and risk profile. It’s good to keep in mind that this condo insurance estimate could change once the policyholder finalizes their policy options because any adjustments to coverage terms will likely impact the final cost of the insurance policy.
Claims Process
When filing a claim, policyholders want the entire process to be quick and easy so they can receive their funds as soon as possible. Therefore, it can be important to review the insurance company’s claims process before purchasing any policy. Many insurance companies offering condo insurance will allow policyholders to file claims either online, over the phone, using the company app, or by talking to an agent or company representative. When shopping around, it’s a good idea for condo owners to ask the companies what their claims process is like and how long it generally takes to process and pay out claims. Also, condo owners may want to ask friends and family members if they have filed a claim with the insurance company to find out what their experience was like. Checking sites such as the Better Business Bureau for reviews can also provide good insight into what the claims process is like with an insurance company.
Deductibles
A deductible is the amount that’s deducted from the payout when a policyholder files a claim. For instance, if the condo insurance policy has a $1,000 deductible and the approved claim amount is $10,000, the insurance company will deduct $1,000 from the total payout, giving the policyholder $9,000. Many companies offer a variety of deductible options, so policyholders can choose one that fits their budget. It’s good to keep in mind that the lower the deductible, the higher the insurance premiums usually will be. When selecting a deductible, policyholders may want to consider the short-term benefits of a higher deductible since that option will reduce their insurance premiums. On the other hand, some condo owners may prefer a lower deductible so they can receive a larger payout on a future claim, even if that means paying higher insurance rates.
Additional Policies
Insurance companies often offer a variety of insurance policies in addition to condo insurance. For example, they may also offer auto, life, pet, boat, and other types of insurance that a condo owner may need. Purchasing condo insurance from a company that offers many additional policies can provide such benefits as maintaining all insurance policies with just one company, making it easier to keep up with premium payments and updating coverage terms. Insurance companies may also offer discounts to customers who purchase more than one type of insurance policy. For policyholders who value these benefits, it may be worth asking each insurance company what additional policies it offers to see if buying different types of insurance from the same company is possible.
Discounts
Discounts are a great way to make condo insurance more affordable. Therefore, when reviewing insurance rates for condo coverage, condo owners may want to ask insurance companies about any discounts that are available. Common discounts include bundling multiple insurance policies, such as condo and pet insurance, from the same company. Condo owners who want to save the most money on their insurance may want to look at the best home and auto insurance bundles available in their area. Insurance bundles are often just the tip of the iceberg when it comes to available discounts on condo insurance. Other savings opportunities could include discounts for enrolling in paperless billing, installing a home security system, or setting up automatic payments. Condo owners may want to consider asking for a full list of discounts in order to maximize their savings on condo insurance.
AM Best Rating
When purchasing condo insurance, policyholders want to trust the insurance company to continue providing coverage and pay out all claims in a timely manner. A good indicator of an insurance company’s financial strength is its AM Best rating. AM Best is an independent credit- rating agency that specializes in evaluating the creditworthiness and financial stability of insurance companies. Based on this information, AM Best awards ratings from A++ (Superior) to D (Poor). A good AM Best rating could indicate that an insurance provider is in a good position to pay out its claims without delay. Policyholders may want to look for insurance companies with an A to A++ rating to enjoy greater peace of mind that their insurance provider will honor its obligations to its policyholders.
Our Top Picks
When researching the best condo insurance companies, condo owners may want to consider companies with high coverage limits, a variety of deductible options, and easy ways to get quotes and file claims, among other factors that may suit their specific needs and circumstances.
Best Overall
State Farm
- Service area: 50 states and Washington, D.C.
- Quote process: Online, phone, agent
- Claims process: Apps, online, phone, agent
- Deductibles: $500 to $10,000
- Discounts: Multipolicy, claim record, home alert protection, automatic sprinklers
- AM Best rating: A++
Pros
- High $1 million personal property coverage available
- High $1 million personal liability coverage available
- Standard fire department service-charge coverage
- Relatively high 20 percent condo and auto bundle discount
- A++ AM Best rating
Cons
- High $10,000 deductible possible
Why It Made the Cut: State Farm offers high coverage amounts on personal property and personal liability coverage, standard fire department service-charge coverage with every policy, and the highest AM Best rating. State Farm may be a great choice for condo owners looking for high coverage limits, as customers can purchase both personal property and extended personal liability coverage for up to $1 million, which is fairly high for condo insurance. The extended personal liability coverage may be an appealing option for condo owners who worry about being found legally liable for any damages they are responsible for—if their dog bites a passerby, for instance, or if a visitor is injured in their home because of a hazard they could have prevented. State Farm also includes standard coverage to help pay for any fire department service charges that a condo owner may incur if they need to call for assistance in putting out a fire. Condo insurance policies don’t always include this type of coverage as an option, so having it come standard can add even more value to a plan. State Farm offers a few deductible options with its policies, including a $10,000 deductible that is very high for condo insurance. But State Farm customers can get a lower rate on their insurance by bundling their condo and auto insurance policies to get a discount as high as 20 percent, which is very competitive for this type of bundle. Additionally, the company boasts an A++ AM Best rating, which bodes well for having claims paid on time as agreed.
Runner-Up
Allstate
- Service area: 50 states and Washington, D.C.
- Quote process: Online, phone, agent
- Claims process: Apps, online, phone, agent
- Deductibles: $500 to $5,000
- Discounts: Multipolicy, welcome, loyalty, protective device, home buyer, automatic payments, early signing, claim-free, responsible payer
- AM Best rating: A+
Pros
- High loss of use coverage of up to 100 percent of personal property coverage available
- High $1 million personal liability coverage available
- Relatively low insurance premiums
- Wide range of discount opportunities available
Cons
- Online quote unavailable for all ZIP codes
Why It Made the Cut: Allstate offers high loss of use and personal liability coverage, potentially low insurance rates that customers may qualify for, and numerous discounts to further lower the cost of condo coverage. Allstate customers can purchase loss of use coverage equal to 100 percent of their personal property limit, which is quite high for this type of coverage with condo insurance. A high loss of use coverage amount could come in handy if their home is left uninhabitable following a covered event and condo owners need to find another place to stay while the damage is repaired. Allstate also offers a high limit on personal liability coverage of up to $1 million, which can help pay for legal fees, medical bills, and other damages that a policyholder may be found liable to pay themselves. Although Allstate has a nationwide footprint, its online quote tool does not necessarily support every location, so condo owners may have to contact an agent or company representative for a quote. It may be worth any extra effort necessary to get a quote, though, as Allstate may be able to offer fairly low rates on condo insurance, depending on the coverage terms and other factors. Allstate also offers numerous discounts for condo owners to apply to their policy and lower their cost of coverage.
Best Policy Options
Amica
- Service area: 48 states and Washington, D.C.
- Quote process: Online, phone
- Claims process: Online, phone
- Deductibles: $500 or $1,000
- Discounts: Multipolicy, paperless, autopay, automatic detection devices
- AM Best rating: A+
Pros
- Exclusive dividend policy option available
- Standard limited water backup coverage
- Standard identity theft coverage
- Relatively high 20 percent condo and auto bundle discount
Cons
- Relatively high monthly insurance premiums
- 2 months’ premiums due up front
Why It Made the Cut: Amica offers an exclusive dividend policy option, water backup and identity theft coverage with every policy, and a generous condo and auto bundle discount that could be as high as 20 percent. Amica condo insurance policies stand out because of the standard coverage terms that are included with each plan. For instance, condo insurance policies come with $5,000 worth of water backup coverage as part of their standard coverage. The insurance company also offers identity theft protection with every condo insurance policy, adding even more value to each plan. While Amica’s condo insurance rates can be somewhat high for this type of insurance—and customers will need to pay two months’ worth of insurance premiums up front—condo owners can bundle their condo policy with an auto policy and receive a relatively large discount in return. In some cases, policyholders may save up to 20 percent on their condo insurance by bundling with an auto policy. Amica customers also have the option to get a dividend policy instead of a traditional insurance policy, which may return a portion of the customer’s annual premium to the policyholder at the end of the year. This is somewhat unique to Amica in regard to condo insurance, and it could help customers save money on their insurance in the long run, assuming they meet eligibility requirements such as enrolling in autopay.
Best for Service Members
USAA
- Service area: 50 states and Washington, D.C.
- Quote process: Online (for USAA members), phone
- Claims process: App, online, phone
- Deductibles: Unknown
- Discounts: Multipolicy, protective device, claim-free
- AM Best rating: A++
Pros
- Standard identity theft coverage
- No deductible on lost or damaged military equipment for active-duty and reserve-duty members
- A++ AM Best rating
Cons
- USAA membership limited to service members and their families
- Unknown deductible options
Why It Made the Cut: USAA includes identity theft coverage with every policy, holds the highest AM Best rating, and allows active-duty and reserve-duty members to file claims on lost or damaged military equipment and uniforms without owing a deductible. USAA caters exclusively to active and former members of the armed forces, and while that may limit the availability of its condo insurance offerings, it can also lead to exclusive perks for eligible service members and their families. For instance, active-duty and reserve-duty members can use their USAA condo insurance to cover the cost to replace military equipment and uniforms without owing a deductible. In other instances, it’s unclear what deductible a policyholder might owe as this information is not readily available to condo owners without a USAA membership. USAA holds an A++ rating from AM Best, which is the highest rating an insurance company can receive from the credit-rating agency. This is a great indicator that USAA will honor claims from its policyholders. USAA also includes $5,000 worth of identity theft coverage with every condo insurance policy to help pay for any expenses necessary to address instances of identity theft or fraud.
Also Consider
Lemonade
- Service area: 25 states and Washington, D.C.
- Quote process: Online
- Claims process: App
- Deductibles: $500 to $2,500
- Discounts: Multipolicy, protective device
- AM Best rating: Not rated
Pros
- High $1.5 million reconstruction-cost coverage available
- Instant claim approval possible
- Leftover money from customers’ premiums is donated to a nonprofit of the policyholder’s choice
Cons
- Small service area covering 25 states and Washington, D.C.
- No currently rated by AM Best
- Limited discount opportunities
Why It Made the Cut: Lemonade offers high reconstruction-cost coverage, as well as the possibility of receiving an instant claim approval, and maintains a policy of donating excess funds to nonprofit organizations. Lemonade sets itself apart in a few key ways. For instance, Lemonade customers can purchase reconstruction-cost coverage of up to $1.5 million, a very high amount for condo insurance that could help pay for reconstruction costs in a worst-case scenario. In addition, the company uses an AI-based claims system to process insurance claims and flag potential instances of insurance fraud, so claims can be instantly approved and paid out in some cases. Maximizing savings could be difficult given that Lemonade only offers two types of discounts for condo owners to take advantage of: multipolicy bundles and protective device discounts. The company also has not been rated by AM Best yet. That being said, Lemonade has been rated by Demotech, a financial analysis firm specializing in regional and specialty insurance providers, and received an A rating, which reflects “exceptional” financial stability. Lemonade condo insurance is available in just 25 states and Washington, D.C., which limits availability, but eligible condo owners may be very interested in the company’s policy on charitable donations. Lemonade Giveback is a program that the company uses to earmark a certain portion of a customer’s unclaimed insurance premiums each year for donation to one of over 100 nonprofits. Customers can choose which nonprofit they want to support with unclaimed funds when they sign up for a policy with Lemonade.
Our Verdict
State Farm was chosen Best Overall due to its high coverage limits on personal property and personal liability coverage as well as the standard fire department service-charge coverage that comes with every condo policy. Allstate was given the nod for Runner-Up because of the possibility of low insurance rates plus the opportunity for condo owners to maximize savings thanks to the company’s numerous available discounts.
How We Chose the Best Condo Insurance Companies
When determining which companies could be considered the best condo insurance providers, we looked at factors related to availability, coverage, cost, and customer experience first and foremost. Service area was a major consideration, as it informs the availability of condo insurance coverage for people across the country. Coverage terms, both standard terms included with every policy and add-on coverage options, were another important factor that was weighed when we assessed each insurance company. Our research also looked at cost considerations such as insurance rates, discounts, and deductible options for condo insurance. Experiential issues, including those related to the quote and claims process, factored into our rankings as well.
Before You Choose One of the Best Condo Insurance Companies
It’s important to note not every condo insurance company featured here is the right choice for every condo owner. While there’s a lot to like about all the insurance companies listed above, condo owners may find that one insurance provider is a much better fit than others. That’s why it’s important for prospective insurance customers to conduct their own independent research before making a decision. A good starting point could be to check on condo insurance options with an existing insurance provider—a condo owner’s auto insurance provider, for instance—to see what coverage, if any, is available as well as possible discounts that could reduce policy costs. Reaching out to local and/or regional insurance companies that offer condo insurance is another good step because these companies may have custom options specific to the condo’s location—such as flood or earthquake coverage options.
Cost of Opting for One of the Best Condo Insurance Companies
Of course, every condo owner wants to find cheaper condo insurance, but every situation will be different. Figuring out how much insurance will cost on a condo or other home will depend on the terms selected and any risk factors at play. It may be worth taking the time to conduct a condo insurance comparison that examines the coverage available plus rate quotes from each company. In fact, condo owners may want to compare rates from at least three insurance providers based on the same coverage options in order to get a fair and accurate comparison. Getting quotes on the same day using the same parameters is the best approach given that rates fluctuate often.
The Advantages of Opting for One of the Best Condo Insurance Companies
Condo insurance can be very helpful if a condo owner’s property or belongings are damaged by a covered event such as a fire or storm. It can also protect policyholders’ financial interests if they are found liable for damages they caused themselves or if a visitor is injured on their property. The best condo insurance companies offer plenty of other benefits and perks that can make life easier for condo owners:
- High coverage limits on personal property, personal liability, and for loss of use for condo owners who want more protection from their insurance policy;
- Generous discount opportunities in some cases that can help lower the cost of insurance coverage; and
- Standard coverage terms that may include water backup, identity theft, and fire department service-charge coverage, increasing the value of an insurance plan.
FAQs
Shopping for condo insurance can be confusing and take a lot of time in some cases, but it’s necessary for condo owners to find the best policy available for their specific needs. Here are some of the most frequently asked questions when it comes to finding the best condo insurance available so condo owners can find the right fit for their needs.
Q. What does condo insurance typically cover?
Condo insurance is a specific type of homeowners insurance that offers coverage for the policyholder’s individual unit as well as personal belongings in the event that they are damaged or destroyed. This type of insurance typically includes liability protection in case a guest is injured in the home or if the policyholder causes property damage or injury to another party.
Q. How long does it take to get condo insurance?
It could take as little as a few minutes to a few days to purchase condo insurance, depending on the company’s purchase and review process as well as the risk factors at play. For instance, condo owners who have never filed an insurance claim may be approved for an insurance policy more quickly than those who have submitted multiple claims in the past.
Q. Can I get condo insurance if I already have some type of property insurance?
Getting condo insurance is an option for every condo owner even if they own another property that’s already insured. In fact, mortgage lenders will likely require buyers to purchase a separate condo insurance policy before approving a loan for a new condo unit.
Q. Is there any difference between condo and homeowners insurance?
While both condo and homeowners insurance typically provide personal property, liability, and loss of use coverage, among other types of coverage, the main difference between condo insurance and homeowners insurance is that the latter covers the property’s entire structure. Condo insurance, meanwhile, covers the interior of the unit rather than the whole building. Roof, exteriors, and common areas are commonly insured by the condo association instead.
Q. Does condo insurance cover appliance repairs?
If the appliance is damaged by a covered peril, condo insurance would cover the repair, but it doesn’t cover normal wear and tear or manufacturer defects. For coverage in those cases, condo owners may want to consider purchasing one of the best home warranties for condos.
Q. Does condo insurance cover flood damage?
Condo insurance may exclude water damage in some situations, and it typically won’t cover flood damage. That being said, some companies may offer flood coverage as a standard term or add-on endorsement. In other situations, condo owners would need to purchase a separate flood insurance policy if they want this kind of protection.