Buying your first townhome is an exciting—but understanding how to protect it with the right insurance is just as important. Townhome insurance isn’t exactly like a standard homeowners policy or renters policy, and knowing what you’re responsible for is key.
Here’s a simple breakdown of what first-time townhome insurance buyers should know.
Understand What Your HOA Covers
Most townhome communities have a Homeowners Association (HOA) that carries a Master Insurance Policy. This typically covers:
- The building’s exterior (roof, siding, shared walls)
- Common areas (sidewalks, clubhouses, pools)
- Liability for common area incidents
However, the level of coverage can vary widely. Some master policies only cover the bare minimum (called “bare walls” coverage), while others may extend into parts or all of the interior. A commonly used term for townhome insurance coverage is “walls in”. This means the town home owner is responsible for covering the walls or Sheetrock Inward. This means all walls, flooring, cabinetry, trim work.
Tip: Request a copy of the HOA Master Policy and review it carefully—or ask your insurance agent to do it for you.
You’ll Likely Need an HO6 Policy
If you own a townhome, you’re probably looking for an HO6 Policy, also known as condo insurance. This policy typically covers:
- Interior structures like flooring, drywall, cabinetry, and fixtures
- Personal belongings
- Loss of use (if your home becomes uninhabitable due to a covered claim)
- Personal liability if someone is injured in your home
- Loss assessment coverage to help cover HOA-assessed costs not paid by the master policy
Pay Attention to Loss Assessment Coverage
This is one area many new townhome buyers overlook. If your HOA issues a special assessment—for example, due to a high deductible on their master policy for hail damage—you could be on the hook for thousands of dollars.
Loss Assessment Coverage on your HO6 policy can help cover your portion of that cost. We recommend reviewing this coverage closely and making sure it’s high enough for your HOA’s deductible limits.
Protect Your Personal Belongings
Unlike the HOA’s master policy, your HO6 policy is the only protection for your furniture, electronics, clothing, and other personal items. Be sure to:
- Take a home inventory
- Choose replacement cost coverage over actual cash value (so you’re not stuck with depreciation)
- Update coverage as your possessions grow or change in value
Work With an Independent Insurance Agent
Buying townhome insurance for the first time can feel confusing—but it doesn’t have to be. An independent insurance agency like Ameriguard Insurance can help you:
- Review your HOA policy
- Compare multiple quotes from top insurance companies
- Customize your coverage to fit your unique situation and budget
Final Thoughts
The right townhome insurance gives you peace of mind and financial protection when it matters most. If you’re unsure about what you need, reach out to a licensed agent who understands how HO6 and HOA policies work together.