HO-4 vs. HO-6 Insurance: What's the Difference?

HO-4 renters insurance provides several layers of protection for tenants, even though it does not cover the physical structure of the building. A standard HO-4 policy includes these main coverages:

• Personal Property: Covers your furniture, electronics, clothing, and other personal belongings against perils like fire, theft, vandalism, and certain water damage.
• Liability Protection: Pays for legal defense and damages if someone is injured in your rented home or if you accidentally damage someone else's property.
• Additional Living Expenses (ALE): Covers hotel stays, restaurant meals, and other costs if a covered loss forces you to temporarily leave your rental.
• Medical Payments to Others: Pays limited medical bills for guests injured in your home, regardless of fault.

HO-4 renters insurance covers a wide range of risks, but renters should understand its exclusions before purchasing a policy. Knowing these gaps helps you decide whether additional coverage is needed:

• Building Structure: Damage to the physical building, including walls, roof, and foundation, is not covered; that's the landlord's responsibility.
• Flood Damage: Standard HO-4 policies exclude flood damage; a separate flood insurance policy is required.
• Earthquake Damage: Earthquakes are typically excluded and require a separate endorsement or standalone policy.
• Maintenance Neglect: Damage resulting from failure to maintain the property (for example, mold from unreported leaks) is not covered.
• High-Value Items: Jewelry, art and collectibles above standard sub-limits may require a scheduled personal property endorsement.
• Roommate Belongings: Your policy only covers your belongings. A roommate must purchase their own separate renters insurance policy.

HO-6 condo insurance provides broader coverage than renters insurance because it must also protect the physical interior of your unit. A standard HO-6 policy includes these core coverages:

• Interior Dwelling Coverage: Covers your unit's interior walls, floors, ceilings, built-in appliances, and fixtures against covered perils like fire, water damage, and vandalism.
• Personal Property: Protects your furniture, electronics, clothing, and other belongings from covered losses.
• Liability Protection: Covers legal costs and damages if someone is injured inside your condo or if you accidentally cause damage to a neighboring unit.
• Additional Living Expenses (ALE): Pays for temporary housing and related costs if your condo becomes uninhabitable due to a covered loss.
• Loss Assessment Coverage: Covers your share of a special assessment charged by your HOA after a covered loss that exceeds the master policy's limits.
• Medical Payments to Others: Pays limited medical expenses for guests injured in your condo unit, regardless of fault.

HO-6 condo insurance has a broader scope than renters insurance, but condo owners should understand its notable exclusions. Knowing these gaps helps you assess whether additional endorsements or separate policies are necessary:

• Building Exterior: The exterior structure, including the roof, hallways, parking areas, and common spaces, is covered by the HOA's master policy, not your HO-6.
• Flood Damage: Standard HO-6 policies do not cover flooding; a separate National Flood Insurance Program (NFIP) or private flood policy is needed.
• Earthquake Damage: Earthquakes are excluded from standard coverage and typically require a separate endorsement or policy.
• Maintenance Damage: Gradual damage from neglect, such as mold or pest infestations, is not covered under a standard HO-6 policy.
• Other Unit Damage: Damage originating in a neighboring unit (for example, a pipe burst next door) may not be fully covered without specific endorsements.
• Improvements Without Endorsement: Major renovations or upgrades you make to your unit may not be covered unless you add a betterments and improvements endorsement.

Your HOA's master policy plays a central role in determining how much interior coverage your HO-6 policy needs to provide. Review the master policy carefully before purchasing condo insurance. The type of master policy your HOA carries directly affects where your personal coverage must begin:

• Bare Walls Policies: One of the most common types of master policies, bare walls coverage covers only the building's structure and common areas. Everything from the drywall inward, including flooring, cabinets, and fixtures, is your responsibility and must be covered by your HO-6.
• All-In Policies: Less common, all-in (or all-inclusive) master policies cover the building structure plus original fixtures and finishes inside each unit, reducing the amount of interior dwelling coverage you need in your HO-6.
• Requesting Master Policy Declarations: Always ask your HOA board for a copy of the master policy declarations page so your insurance agent can identify the exact coverage gap your HO-6 must fill.
• Betterments and Improvements Endorsement: If you've upgraded your unit beyond original specifications, such as new hardwood floors, custom cabinetry, or upgraded appliances, you'll need this endorsement to make sure those improvements are covered under your HO-6.