The one-paragraph answer
If you own a house roof-to-foundation, including the ground under it, you buy an HO-3 and insure the whole structure yourself. If you own a condo, the association carries a master policy on the building, and your HO-6 insures inward from there: your interior finishes, your belongings, your personal liability, and your share of the assessments the HOA can pass down after a loss. Townhouses land on either side of the line depending on the deed and the CC&Rs. The expensive mistakes run both directions — paying to insure structure the master policy already covers, or assuming the association covers things it doesn't.
| HO-3 (homeowners) | HO-6 (condo unit-owners) | |
|---|---|---|
| The building itself | All yours — dwelling covered open perils | Mostly the master policy's job; your policy picks up at the walls |
| Your dwelling limit covers | Full rebuild of the structure | Interior build-out: flooring, cabinets, fixtures, finishes, improvements |
| Personal property | Included, named perils | Included, named perils — often the biggest limit on the policy |
| Liability & medical payments | Included | Included |
| Loss assessment | Not applicable | Essential — covers your share of HOA shortfalls after a covered loss |
| The document that sets your limits | A rebuild-cost estimate | The HOA's CC&Rs and master policy |
The master policy decides where your policy starts
Every association insures the buildings somehow. What varies — and what changes your HO-6 completely — is how deep into your unit that master policy reaches. Associations generally use one of two approaches, with hybrids in between:
"All-in" master policies cover the structure including the interior finishes as originally built — the drywall, the original flooring, the original cabinets. Your HO-6 dwelling limit then mostly needs to cover improvements you've made beyond original spec, plus your contents, liability, and loss assessment exposure.
"Bare walls" master policies stop at the unfinished interior surfaces. Everything from the drywall inward is your problem: cabinets, counters, flooring, fixtures, sometimes even interior partitions. On a bare-walls association, the dwelling portion of your HO-6 is doing real structural work, and a limit chosen by guesswork is how unit owners end up badly underinsured after a fire or a major water loss.
Same floor plan, same street — the right HO-6 dwelling limit can differ dramatically based on nothing but the association's insuring approach. That's why the first question we ask a condo client isn't about the unit. It's about the documents.
Where to find the answer: your HOA documents
Two documents settle it: the CC&Rs (the covenants, conditions and restrictions recorded for the community, usually with an insurance section) and the master policy declarations, which your property manager or HOA board can provide. Between them you're looking for three things: whether the master coverage is all-in or bare-walls, the size of the master policy deductible, and whether that deductible can be assessed to individual owners after a loss.
Reading CC&Rs is genuinely tedious, and we don't recommend doing it alone. What the documents legally obligate you to do is a question for an attorney; what they mean for your insurance limits is exactly what your broker is for. Send us the insurance section and the master policy summary, and we'll translate it into numbers. The coverage framework itself works like any homeowners policy — it's the starting line that moves.
Master deductibles are the quiet story
As California carriers have repriced association business, master policy deductibles have climbed — and many CC&Rs allow the HOA to pass a deductible down to the owners whose units were involved in the loss. A water leak that crosses two units can arrive as a painful assessment letter. That's the gap loss assessment coverage exists to fill.
Loss assessment — the coverage condo owners actually use
When the association's insurance falls short — a deductible passed to owners, a limit that didn't stretch, a liability judgment above the master policy — the HOA divides the shortfall among unit owners as a special assessment. Loss assessment coverage pays your share, provided the assessment stems from a peril your policy covers.
The limit built into a standard HO-6 is modest. Raising it by endorsement is typically inexpensive relative to the exposure, and we treat it as a default conversation on every condo placement. One caveat matters in California: assessments caused by an excluded peril — earthquake being the big one — aren't covered by the standard endorsement. Earthquake loss assessment is its own coverage, bought alongside a separate earthquake policy, and condo owners in older buildings should ask about both.
When a townhouse takes an HO-3
Townhouses cause most of the wrong-form confusion, because the architecture doesn't answer the question — the deed does. If you own the structure roof-to-foundation plus the lot, and the association only maintains common areas like streets and greenbelts, you're a homeowner in every sense that matters to an insurer: you take an HO-3 and set a full rebuild-cost dwelling limit. If the association insures the building shells and you own the airspace and interior, you take an HO-6 no matter how house-like the unit feels.
Don't guess. The CC&Rs state which structures the association insures, and your broker confirms the form before quoting. A townhouse on an HO-6 when the association doesn't actually insure the shell is catastrophically underinsured; a townhouse on an HO-3 when the master policy already covers the building is paying twice for the same walls. Both failure modes are common, and both are avoidable with one document review. The same who-insures-what logic drives the HO-3 vs DP-3 occupancy question for rentals.
See it priced for your home
Four minutes to a live HO-3 indication — then sign the real ACORD 80 online.
Admitted carriers, FAIR Plan + DIC, and E&S markets, shopped by an independent broker. No fee, no obligation.
Get a pricing indication →What doesn't change between the forms
The parts of the policy that follow you rather than the building work the same way on both forms. Your belongings are covered against named perils, with the same sub-limit and endorsement conversations as any Coverage C discussion. Your personal liability protects you the same way whether the incident happens in a condo or a house, and an umbrella stacks above either form. And fire — including wildfire — is a covered peril on both, just as it is on the HO-3 and the FAIR Plan. The form decides where your building coverage starts, not whether you're protected.
Frequently asked
Does an HO-6 cover earthquake damage?
No — earthquake is excluded from the HO-6 exactly as it's excluded from the HO-3. Condo owners have two separate conversations to consider: an earthquake policy for their own unit and contents, and earthquake loss assessment coverage for their share of damage to the building the association insures.
My HOA says the master policy "covers everything." Do I still need an HO-6?
Yes. Even the most generous all-in master policy covers the structure — not your belongings, not your liability, not your additional living expenses if the unit is uninhabitable, and not your share of assessments. Mortgage lenders on condos typically require an HO-6 for exactly this reason.
Which form costs more?
There's no universal answer, and we won't invent one — an HO-6 insures less structure, but limits, building age, and carrier appetite drive the number. What we can tell you is that carrier selection moves premium more than form selection; we routinely see identical risks priced 20–40% apart by carrier. That's a shopping problem, which is what a broker is for.