Condo Insurance in Indiana: What Your HOA's Master Policy Leaves to You

Key takeaways

• Your association's master policy and your own condo policy are designed to meet in the middle. Where exactly they meet is set by your association's governing documents — and it is different at every property.
• Indiana law requires your association to carry insurance. Indiana Code 32-25-8-9 obligates condominium associations to maintain a master casualty policy covering common areas at full replacement value, plus a master liability policy.
• The single most useful thing you can learn this week is whether your association's master policy is bare walls, single entity, or all-in. That one answer changes how much building coverage you need by tens of thousands of dollars.
• Loss assessment coverage is the gap almost nobody checks. A standard condo policy may include as little as $1,000 of it, and even owners who buy $50,000 often have a separate, much smaller special limit that applies to the association's deductible.

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What's in this guide

1. What condo insurance covers
2. The question that decides everything: which master policy does your association carry?
3. What Indiana law requires of your association — and what it doesn't
4. The remodel gap: improvements and betterments
5. Loss assessment: the coverage you think you have
6. How to find out where you stand, in one afternoon
7. Frequently asked questions

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A pipe lets go in the unit above yours on a Tuesday afternoon while nobody is home. By the time anyone notices, water has come through your ceiling, down the wall behind your bookcase, and into the flooring you paid to have installed three years ago.

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Now the questions start. Does the association's policy pay for your ceiling? Does it pay for the floor you upgraded? Does your neighbor's policy pay, since it was their pipe? Does yours? And when the association's insurer applies a deductible that runs into five figures and splits it across all forty units, who pays your share?

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Every one of those questions has a real answer. Not one of them has a universal answer — they depend on documents most condo owners have never read. This is a walkthrough of where to find them and what they mean.

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What does condo insurance cover?

A condo policy — the industry calls it an HO-6 — covers the part of your home that your association's master policy does not: typically the interior of your unit, your personal property, your liability, and the assessments your association can pass along to you after a loss.

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That definition sounds simple and hides the whole problem, because the phrase doing all the work is the part your association's master policy does not. A condo is not a house, and it is not an apartment. You own your unit and you own a share of everything else, jointly, with every other owner in the building. Insurance follows that split, and the split is written into your association's declaration and bylaws rather than into state law.

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The four parts of a condo policy generally line up like this:

• Dwelling / building property (Coverage A). The interior structure you are responsible for. Depending on your master policy, this can mean everything inward from the bare studs, or only the upgrades you installed.
• Personal property (Coverage C). Furniture, clothes, electronics, everything you would take with you.
• Personal liability (Coverage E). If someone is injured inside your unit, or you cause damage that reaches a neighbor's.
• Loss assessment. Your share of costs the association charges back to owners after a covered loss. This one gets its own section below, because it is where the surprises live.

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For context on what the market looks like, Insurance.com's 2026 figures put the national average condo premium at $815 a year and Indiana's at $709, based on $60,000 of personal property coverage and $300,000 of liability with a $1,000 deductible. Treat those as published averages, not as a quote — your own premium depends on your building, your unit, your coverage selections and your insurer's underwriting.

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The question that decides everything: which master policy does your association carry?

If you read nothing else here, read this.

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Condo master policies come in three broad types. Your association has one of them. It determines where the association's responsibility stops and yours starts, and the difference between the extremes is enormous.

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                           Bare walls (studs-in) | Single entity (walls-in) | All-in (all-inclusive)

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Master policy covers | Building shell, roof, exterior, common elements — stopping at unfinished interior surfaces | All of the above, plus the unit's original builder-grade fixtures and finishes | All of the above, plus owner-installed upgrades and improvements

You cover through your HO-6 | Drywall, paint, flooring, cabinets, appliances, built-in fixtures, and every improvement | Your upgrades and improvements — the gap between builder-grade and what you installed | Personal property, liability, loss assessment, and the master deductible gap

Typical HO-6 building limit needed | Highest — commonly $40,000–$100,000 depending on unit size | Moderate | Lowest

The trap | Owners insure for personal property only and discover the drywall is theirs | A remodel gets restored to builder grade, not to what you installed | Complacency — you still own the deductible and assessment exposure

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Picture the difference in the scenario from the top of this article. Water comes through your ceiling and ruins your flooring.

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Under a bare walls master policy, the ceiling drywall, the paint, and the flooring are all yours. Your HO-6 building coverage is what rebuilds them, and if you set that limit at $15,000 because it seemed like a generous number for "a condo," you are going to find out it wasn't.

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Under an all-in policy, most of that same damage is the association's to repair, including the flooring you upgraded.

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Same water. Same unit. Two completely different outcomes, decided by a document you can request by email.

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Where to find it: the master policy type is described in your association's declaration, usually in an article titled something like "Insurance" or "Maintenance, Repair and Replacement." Your property manager or board secretary can send you the declaration and a current certificate of insurance. Most will do it within a few days if you ask.

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What Indiana law requires of your association — and what it doesn't

Indiana does set a floor here, and it is worth knowing what it is.

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Indiana Code 32-25-8-9 requires condominium associations to purchase and maintain two things:

1. A master casualty policy — fire and extended coverage "in an amount consonant with the full replacement value" of the common areas and facilities.
2. A master liability policy — in amounts determined by the association's bylaws, declaration, or board.

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The statute also reaches land and improvements where the association has ownership or shared rights.

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Now the part that matters to you as an owner. Indiana's code does not prevent individual unit owners from carrying their own insurance — you are free to, and given everything above, you should. It also contains no statutory provision on waiver of subrogation in the condominium context. That second point is more consequential than it sounds: subrogation is an insurer's right to recover from whoever caused a loss, and whether that right is waived between the association and unit owners is a matter for your governing documents rather than a matter the state has settled for you.

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So Indiana law guarantees your association carries something for the common areas. It does not tell you where the boundary sits in your building, it does not size your HO-6 for you, and it does not stop a properly assessed cost from landing on your statement. Those are all in your declaration.

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The remodel gap: improvements and betterments

This one catches people who did everything else right, and it lives inside the single entity master policy specifically.

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A single entity master policy covers the unit's fixtures and finishes as originally constructed — builder-grade cabinets, builder-grade flooring, builder-grade appliances. That sounds generous until you have remodeled.

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Say you replaced a laminate counter with stone, swapped builder-grade cabinets for custom, and put down hardwood where carpet used to be. A covered loss destroys the kitchen. The master policy restores it — to builder grade. The difference between what it pays and what you installed is the improvements-and-betterments gap, and it is yours to fund through your own condo policy.

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Two practical habits close it:

• Tell your agent when you renovate. Not at renewal, not eventually — when the work is done. A remodel changes what it costs to put your unit back, and a limit set before the remodel is a limit set for a unit that no longer exists.
• Keep the paperwork. Contractor invoices, receipts, and a few dated photos of the finished work. After a loss, the argument is always about what was there and what it was worth, and documentation created before the loss is worth considerably more than a memory created after it.

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If you have never documented your unit's contents at all, the same walkthrough that works for a house works here: phone on video, every room, open the closets and cabinets, narrate as you go, and store the file somewhere that is not inside the condo. It takes under an hour. Our full Indiana homeowners guide covers the same documentation habit in more detail.

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Loss assessment: the coverage you think you have

Here is the gap I would most want a condo owner to check, because it is the one where the number on the policy and the number in people's heads are furthest apart.

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Loss assessment coverage responds when your association charges owners a special assessment after a covered loss. Allstate describes it applying in three situations: damage to common areas that exceeds the association's master policy limit, injuries in common areas where the association is liable, and the association's deductible — which can run to $25,000 or higher.

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Two things about it surprise people.

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First, the default is small. A standard condo policy may include as little as $1,000 of loss assessment coverage. Higher limits are available as an endorsement — commonly $10,000 to $100,000 depending on the insurer — usually at modest annual cost. Most owners have never been asked which they want, so they have the default.

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Second — and this is the part almost nobody knows — buying a big limit may not do what you think for deductible assessments. The standard ISO loss assessment endorsement (form HO 04 35 04 91) carries a separate special limit that applies specifically to assessments arising from the association's deductible. That special limit is commonly $1,000, sometimes $2,500, and it applies regardless of how much overall loss assessment coverage you bought.

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The worked example is worth walking through slowly, because the arithmetic is what makes it land:

• Your association carries a $20 million master policy with a 5% wind deductible. That deductible is $1 million.
• A windstorm damages the roof. The association pays its deductible and assesses owners to recover it.
• Split across 100 units, your share is $10,000.
• You bought $50,000 of loss assessment coverage, so you feel covered.
• But the deductible special limit in your policy is $1,000. Your policy pays $1,000. You write a check for $9,000.

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That is not a loophole or an insurer behaving badly — it is standard endorsement language that has been in use for decades. It is simply a provision very few owners have ever had explained to them.

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What to do about it: ask your agent two specific questions. How much loss assessment coverage do I carry? And what special limit applies to assessments arising from the association's deductible? Then ask your association what its master policy deductible is and how it is allocated among units. Those three numbers, together, tell you your real exposure. Some insurers offer a higher special limit for deductible assessments; your agent can tell you whether yours does.

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How to find out where you stand, in one afternoon

None of this requires an expert. It requires two documents and about ninety minutes.

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1. Email your property manager or board for two things. The current declaration and bylaws, and a current certificate of insurance for the master policy. Ask plainly: is our master policy bare walls, single entity, or all-in, and what is the deductible? A good manager answers this in one reply.

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2. Read one section of the declaration. Find the article on insurance or on maintenance and repair. You are looking for language about what the association insures and where owner responsibility begins — words like "studs," "unfinished surfaces," "fixtures as originally installed," or "improvements and betterments."

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3. Pull up your own declarations page. Write down four numbers: your building/dwelling limit, your personal property limit, your liability limit, and your loss assessment limit.

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4. Compare them. If your master policy is bare walls and your building limit is small, that is your biggest gap. If it is single entity and you have remodeled, your gap is the remodel. In every case, check the loss assessment limit against the association's deductible divided by the number of units.

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5. Write down what you could not find. Anything unanswered after steps one through four is the agenda for a fifteen-minute call. That is a much better conversation than "am I covered?" — it is four specific questions with four specific answers.

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6. Do it again after any renovation, and after any notice that the association changed carriers or deductibles. Master policies change at renewal like any other policy, and associations do not always explain what changed.

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The bottom line

Condo ownership splits a building between you and everyone else who lives in it, and your insurance splits along the same line. The line is drawn in your association's declaration, not in Indiana's statute and not in any general article — including this one.

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So the whole task reduces to three questions worth answering this month rather than after a loss. Which master policy type does your association carry? What is its deductible, and what is your share of it? And do your own limits — building, personal property, liability, loss assessment — match the answers to the first two?

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If you would like someone to read your declaration alongside your policy and tell you plainly where the gaps are, get a quote or request a personalized policy review from the AOG Group team, or call us at 317-981-2046. You can also read more about how we approach condo coverage. We work with condo owners across Indiana, and this is a conversation we have often.

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Nothing in this article states what any particular policy covers or what any owner should purchase. Coverage, limits, availability and eligibility are determined solely by the terms of your own policy and your association's governing documents, your carrier's underwriting, and applicable Indiana law. Premium figures cited are published averages from the sources below, not quotes.

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About the author

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Lee Boyer is a licensed Property & Casualty and Life & Health insurance agent with more than seven years at Allstate, all of them inside the AOG Group agency in Indiana. He writes about coverage the way he explains it at his desk — in plain English, without the sales pitch.

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Sources

• Indiana Code 32-25-8-9, via Merlin Law Group — Is Your Indiana Condominium in Compliance with the Law? Mandatory Indiana Insurance Requirements (master casualty and master liability requirements; no statutory waiver-of-subrogation provision) · https://www.merlinlawgroup.com/is-your-indiana-condominium-in-compliance-with-the-law-mandatory-indiana-insurance-requirements/
• Coverwatch — Condo Master Policy Types Explained (2026) (bare walls, single entity and all-in definitions; typical HO-6 building limits of $40,000–$100,000 under bare walls) · https://coverwatch.com/blog/hoa/condo-master-policy-types
• Trailstone Insurance — The Condo Deductible Surprise (ISO form HO 04 35 04 91 special limit on deductible assessments; the $1 million wind deductible worked example) · https://trailstoneinsurance.com/blog/the-condo-loss-assessment
• Insurance.com — Average condo insurance cost in 2026 (national average $815/year; Indiana $709/year, at $60,000 personal property and $300,000 liability with a $1,000 deductible) · https://www.insurance.com/average-condo-insurance-rates

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