Owning a condo in Massachusetts offers convenience, comfort, and community — but it also means sharing financial responsibility for the building. When major damage or unexpected costs hit your condo association, you could receive a surprise bill. Loss assessment coverage helps protect you from those unexpected out-of-pocket costs.
At Risman Insurance, we help Massachusetts condo owners understand how loss assessment coverage works and why it’s an essential part of your condo insurance policy.
What Is Loss Assessment Coverage?
Loss assessment coverage is a safeguard included in most HO-6 condo insurance policies. It helps cover your portion of shared costs when your condominium association’s master policy doesn’t fully pay for damages or liabilities.
For example, if a fire damages the roof or lobby and repair costs exceed the master policy limit, your condo association can issue an “assessment” — essentially billing each unit owner for part of the uncovered expense. Loss assessment coverage helps pay your share of that bill.
Why Massachusetts Condo Owners Need This Coverage
- Unforeseen events: Fires, windstorms, and other disasters can lead to major repair costs in common areas. This coverage helps you avoid large surprise expenses.
- Master policy gaps: Condo associations often have limits that don’t fully cover rebuilding or legal costs. Loss assessment coverage fills those gaps.
- Legal liability protection: If your association is sued, each owner may share in the legal expenses. This coverage helps you handle your portion.
- Building code upgrades: Massachusetts building codes may require updates after damage — such as new sprinkler systems or electrical work. This coverage can help with those added costs.
- Common area damage: Shared areas like roofs, garages, or elevators aren’t always fully covered by the master policy. This coverage protects you from shared repair bills.
How Much Loss Assessment Coverage Should You Have?
Most standard condo insurance policies include only $1,000 of loss assessment coverage — not nearly enough for most situations. We often recommend increasing your limit to $10,000 or more for better protection.
Every condo association is different, so your coverage should reflect your building’s size, reserve fund, and insurance structure. A quick review of your policy and association bylaws can help you determine the right amount.
Tip: Learn more about how to set the right limits in our related article:
HO-6 Condo Insurance: Why Unit Owners Coverage Is a Must (and How to Get the Limits Right).
How to Add Loss Assessment Coverage
If you already have an HO-6 condo policy, adding or increasing loss assessment coverage is simple — and surprisingly affordable. Your Risman Insurance agent can update your limits and explain how this protection works with your condo association’s master policy.
Not sure what your current master policy covers? We’ll review it with you and make sure you’re protected where it matters most.
Protect Your Condo Investment Today
Your condo is one of your most valuable assets. Don’t let a special assessment from your association catch you by surprise. Loss assessment coverage provides affordable peace of mind for Massachusetts condo owners — and can save thousands when the unexpected happens.
Call (781) 396-2116 or Request a Quote today to review your condo insurance policy and ensure you have the right loss assessment protection in place.
Insurance coverage cannot be added, deleted, or changed until confirmed in writing from our office.
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