Colorado condo and townhome insurance
The Colorado Common Interest Ownership Act governs your association. What it does not settle is where the master policy stops and your own policy has to start.
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Three things to settle before you buy a Colorado condo policy
- 1
Hail turns into a special assessment faster here than anywhere
A single Front Range hailstorm can take the roofs off every building in an association at once. Where the master policy pays roofs on an actual cash value schedule or carries a large wind-and-hail deductible, the shortfall becomes a special assessment on every owner. Loss assessment coverage on your own policy is what responds to an assessment arising from a covered loss, and the default limit is usually too small for a roof event.
- 2
Bare walls and all-in are different purchases
A bare-walls master policy stops at unfinished structure and leaves cabinets, flooring, fixtures and built-ins to you. An all-in policy reaches original finishes but not your upgrades. Your dwelling limit has to be set against whichever line the master policy draws, and CCIOA leaves that to the declaration. Read the declaration page, not the summary sheet.
- 3
The master deductible can be charged to your unit
Governing documents commonly let an association charge its deductible to the unit where a loss started, and Denver metro and mountain-resort associations frequently carry deductibles in the five-figure range. A failed supply line in your kitchen then produces a bill with your name on it. Read the figure off the master declaration page and set your loss assessment limit against it.
Water is the claim in every stacked building
Supply lines, washing machine hoses, water heaters and failed shower pans cause more Colorado condo claims than fire and wind combined, and in a stacked building one failure becomes three claims. Replace a water heater past ten years, swap rubber washer hoses for braided ones, and know where the unit shutoff is. A stacked washer-dryer in a closet without a drain pan is worth mentioning on the call.
Mountain-resort units and short-term rental
Summit, Eagle and Routt county units are often rented nightly or weekly, and that is a commercial exposure most personal condo policies exclude. Associations have their own rules on top of that. If the unit is rented at all, say so when you call rather than discovering the exclusion after a guest claim. Freeze exposure in a unit that sits empty between bookings is the other half of the same conversation.
Townhome, rowhouse, or house that looks like one
Ownership decides the policy rather than the architecture. Colorado has a great deal of fee-simple townhome construction where you own the structure and the ground under it, with an association that maintains the grounds and insures nothing of yours. That is a homeowners policy even in a row of identical units. Read the recorded declaration before buying either form.
Documents to have in hand
The association should provide all of these on request. The master policy declaration page is the one that matters.
- The declaration page of the association master policy, not the summary
- The master policy deductible, and the separate wind-and-hail deductible if there is one
- Whether the master policy is bare walls or all-in
- Whether the master policy pays roofs at replacement cost or actual cash value
- The recorded declaration, to confirm whether you own the structure or only the interior
- The reserve study date and any special assessment voted in or pending
- The age of the plumbing stack and of your own water heater
Frequently asked questions
What does an HO-6 condo policy cover?
Your belongings, your liability, your interior finishes and improvements to the extent the master policy does not reach them, loss of use if the unit becomes uninhabitable, and loss assessment from the association.
My HOA sent a special assessment after a hailstorm. Is that covered?
Loss assessment coverage generally responds to an assessment arising from a covered loss, subject to its limit. The usual problem is the limit rather than the coverage, because the default was set long before current roof deductibles.
I rent my mountain condo by the week. Is that covered?
Generally not on a standard condo policy. Nightly and weekly rental is a commercial exposure most personal forms exclude and it needs a policy written for it.
Do I need a condo policy or a homeowners policy for my townhome?
Ownership decides it. If you own the structure and the land, that is a homeowners policy. If the association owns the building and you own the interior, that is a condo policy.
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