If you own a condo or you’re thinking of buying one, you’ve probably asked yourself — is condo insurance cheaper than home insurance? The short answer is yes, condo insurance usually costs less. But there’s more to it than just price. The type of property, who’s responsible for what, and the coverage you choose all affect how much you pay.
In this article, we’ll explain why condo insurance is often cheaper than home insurance, what makes the two different, what’s covered under each, and how to make sure you’re getting the best deal.
What Is Condo Insurance?
Condo insurance, also known as HO-6 insurance, protects your individual condo unit and personal belongings. It also covers you if someone gets injured inside your condo or if you accidentally cause damage to another unit.
Condo owners don’t have to insure the entire building — that’s the condo association’s job. The condo association (or HOA) carries a master insurance policy that covers the building’s exterior, shared spaces, and sometimes parts of the unit’s structure like walls or floors.
Your personal condo insurance only needs to cover:
- The inside of your unit (depending on your HOA’s policy).
- Your personal belongings.
- Liability protection for injuries or damage you’re responsible for.
Because you’re not insuring the whole building, condo insurance costs much less than home insurance.
What Is Home Insurance?
Home insurance, often called HO-3 insurance, is a broader policy that protects an entire property — not just the interior of a unit.
When you own a house, you’re responsible for the structure, the land, and everything inside. That means your home insurance policy must cover:
- The entire dwelling (roof, walls, foundation, etc.)
- Detached structures like garages or sheds
- Personal belongings
- Liability coverage
- Additional living expenses if your home becomes unlivable after a covered loss
Because home insurance covers more risks and a larger area, it naturally costs more than condo insurance.
Why Condo Insurance Is Usually Cheaper Than Home Insurance
The main reason condo insurance is cheaper than home insurance is the difference in what’s being insured.
Here’s a breakdown of the factors that make condo insurance less expensive:
- You’re Not Covering the Entire Structure
Condo owners only insure the inside of their unit. The exterior, roof, and shared spaces are covered under the HOA’s master policy. Homeowners, on the other hand, must insure the entire structure. - Smaller Living Spaces
Most condos are smaller than single-family homes, which means less property to insure and lower overall risk for the insurance company. - Shared Responsibility
Condo buildings share walls, utilities, and maintenance with multiple owners. This spreads out risk and lowers the individual cost for insurance. - Less Exposure to Certain Risks
Detached homes face more exposure to weather damage, theft, and accidents compared to condos that are located within secure, managed communities.
As a result, the average condo insurance premium is around $400 to $700 per year, while home insurance often costs between $1,200 and $2,000 per year, depending on location and coverage.
What Does Condo Insurance Cover?
A standard condo insurance policy (HO-6) usually includes:
- Building Property Coverage: Protects the parts of your condo that you’re responsible for, such as built-in fixtures, flooring, and walls.
- Personal Property Coverage: Covers your furniture, clothing, electronics, and other personal items if they’re stolen or damaged.
- Liability Coverage: Pays for medical or legal costs if someone is injured in your condo or if you accidentally cause damage to another unit.
- Loss of Use Coverage: Helps pay for hotel stays and meals if your condo becomes unlivable due to a covered event.
- Loss Assessment Coverage: Covers your share of costs if the condo association has to pay for major repairs or damage to common areas.
What Does Home Insurance Cover?
A standard home insurance policy (HO-3) includes:
- Dwelling Coverage: Protects the entire structure of your home from covered risks like fire, theft, or windstorms.
- Other Structures: Covers detached buildings such as garages, fences, or sheds.
- Personal Property: Protects your belongings inside the home.
- Liability Protection: Covers you if someone gets hurt on your property.
- Additional Living Expenses: Pays for temporary housing and living costs if your home is damaged and uninhabitable.
Because home insurance covers the entire property and additional structures, it costs more to maintain than a condo policy.
How the HOA’s Master Policy Affects Your Condo Insurance
The type of master policy your condo association carries can also affect how much your condo insurance costs. There are generally two types of HOA master policies:
- Bare Walls-In Policy: Covers only the building’s structure and shared areas, meaning you’re responsible for insuring everything inside your condo — walls, fixtures, floors, and all.
- All-In Policy: Covers both the building’s exterior and the interior structure of your unit. You only need to insure your personal belongings and liability.
If your condo has an all-in master policy, your personal condo insurance will be cheaper because the HOA’s coverage takes care of more.
When Condo Insurance Might Cost More
While condo insurance is usually cheaper, there are a few cases where it might cost more:
- You live in a high-value condo with expensive finishes and fixtures.
- Your building is in a high-risk area (like near the coast or in a flood zone).
- You add optional coverage such as flood insurance or extended liability.
- The HOA’s master policy provides limited protection, requiring you to cover more.
Even in these situations, condo insurance still tends to cost less than full home insurance.
Tips to Save on Condo and Home Insurance
Whether you own a condo or a home, here are a few tips to keep your insurance costs down:
- Bundle your condo or home insurance with auto insurance.
- Install safety features like smoke detectors, security systems, or smart home devices.
- Raise your deductible if you can afford higher out-of-pocket costs.
- Compare quotes from multiple insurers before you buy.
- Maintain good credit, since many insurers use credit-based scores to set premiums.
These simple steps can help you get a cheaper premium no matter what type of property you own.
Is Condo Insurance Always the Better Deal?
Even though condo insurance is cheaper than home insurance, that doesn’t mean it’s automatically the better choice. It depends on your situation.
If you prefer maintenance-free living with shared costs, condos can save you both time and money. But if you want full ownership and more privacy, a house gives you that freedom — even if the insurance is pricier.
At the end of the day, both types of insurance provide peace of mind. What matters most is choosing a policy that protects your property, your finances, and your comfort level.
Final Thoughts: Is Condo Insurance Cheaper Than Home Insurance?
Yes, condo insurance is cheaper than home insurance in most cases. The reason is simple — condo owners don’t have to insure the entire building, only their individual unit and belongings. Homeowners, however, are responsible for the full property, which means higher premiums.
The key is understanding what’s covered by your HOA’s master policy and tailoring your condo insurance to fill the gaps. That way, you get full protection without paying for unnecessary coverage.
Whether you own a condo or a home, comparing quotes and understanding your policy can help you find the best coverage at the best price.