ReSET Blog
Blog · May 18, 2022 · AUTHOR: Darwin Pelea

Do HOA Homes Need Homeowners Insurance?

Homeowners associations (HOAs) are a standard fixture in many suburban neighborhoods. They are usually governed by a homeowners association manager responsible for organizing dues-paying members and managing the association's common areas and grounds. While HOAs typically have a nominal monthly fee for membership, most HOAs also have HOAs insurance requirements for all homeowners. This article will explore whether HOAs need homeowners insurance and the types of HOAs that are likely to have insurance requirements.

What is an HOA?

A homeowners association is a group of people who live in a community and share the responsibility for maintaining common areas and property values. A homeowner's association (HOA) is a legal entity that has been set up by the developer or previous owners of a development of houses. It can be incorporated as a non-profit corporation or a limited liability company.

What does a homeowner's association do?

The role of a homeowner's association (HOA) is to maintain and improve the overall quality of life in its neighborhood. An HOA comprises homeowners who live in a community with shared interests and concerns. The association members elect a board of directors to represent them and oversee activities related to maintaining common areas, managing finances, enforcing rules and regulations, etc. The board also hires management companies or property management firms to handle day-to-day operations.

Why do homes need insurance?

If you own a home with an HOA, you are legally responsible for paying for any damage on the property or to any building on it. For example, if your neighbor breaks a window or falls off his roof while working on his house, you can be sued for damages by them or their insurance company. To avoid being sued, it's essential to ensure that your homeowner's insurance covers those types of claims.

HOAs are not insurance companies

HOAs are not insurance companies and do not provide insurance to their members. Instead, they're community associations that maintain the common areas, like pools, tennis courts, or roads.

HOAs do not provide coverage for things like house fires, earthquakes, or floods — those are things you need to take care of yourself.

You can buy HOA-specific policies to protect your property against certain risks, but they don't watch the house itself. So, for example, if you live in a condo complex where there's a pool in the backyard, and you want to be covered for liability issues (like someone falling into it), you'll want an HOA policy.

In most cases, though, standard homeowners policies are sufficient: If there isn't an HOA policy available, then a standard homeowners policy should cover all of your needs. It will cover damage caused by natural disasters (earthquakes and floods) or manmade disasters (intrusions).

Why do HOAs need homeowners insurance?

When you live in a community with a homeowner's association (HOA), you're already paying for property taxes and other costs, such as maintenance and upkeep of familiar grounds. So why do HOAs need homeowners insurance? There are several reasons why an HOA would want to purchase individual homeowners insurance policies for its members:

1) To protect their property values:

The value of your home depends mainly on how well the community is maintained. If something goes wrong — a fire, vandalism or theft — it could impact your property values. You also want to make sure that if you get sued by someone who lives in the community, they can't use your lack of insurance or coverage as a way to sue you personally.

2) To protect against claims of negligence in their management of the community: 

As part of your HOA fees, you'll be paying for liability insurance that protects against claims that may arise from accidents on common grounds (such as playgrounds, pools, and tennis courts). So, for example, if someone slips and falls while walking through the neighborhood park or playing baseball with his kids there, he could sue both himself and his HOA — individually or collectively — for damages related to his injuries.

3) To protect against lawsuits over injuries on common grounds.

The HOA might be liable for accidents on common grounds, such as slip-and-fall accidents at a pool or playground. However, if someone were to sue the HOA for injuries sustained while playing on those properties, homeowners insurance would provide coverage for any legal costs incurred by the HOA during court proceedings.

4) To help maintain the property in good condition:

To help maintain the property in good condition by paying for repairs to any damage caused by storms or other natural disasters during the policy period, homeowners insurance can help pay for repairs if something happens to your homes, such as a fire or flood or flood storm. However, if it's not insured, you may have to pay out of pocket to fix the damage — and even then, it might not be enough money to replace everything that was damaged fully.

Types of HOAs

Types of HOAs are as follows:

1) Condominium association:

A condominium is a property to which all homeowners have rights, but no one owns it outright. Instead, condominiums are governed by the condo association, which oversees maintenance and repairs, collects dues and fees from members, and makes sure that everyone follows the rules set forth by state law.

2) Cooperative association:

A cooperative is similar to a condominium association. Still, it differs in that each member owns shares in the corporation that owns the property or co-op building itself (typically due to buying into its stock). Each shareholder also has a vote on issues related to the corporation's management and its assets (e.g., repairs or renovations).

3) Townhouse owners association:

This type of HOA is common in planned communities with townhouses or condos. The HOA will manage the common areas, such as pools and other recreational amenities, and enforce any covenants or restrictions that come with your home purchase.

4) Master association: 

A master association oversees multiple subdivisions within one community. You may share amenities with other homeowners, but each property remains privately owned by its owner(s).

5) Civic association:

This type of HOA usually only covers common areas such as sidewalks and streets in a neighborhood or community where homeowners own individual properties rather than townhomes or condos with shared walls (like an apartment building).


Do I need homeowners' insurance if I live in an HOA community?

You should have homeowners insurance even if you live in an HOA community because it protects you from liability claims and other unexpected expenses from homeownership. The policy can also pay for damage caused by fire, water leaks, windstorms, earthquakes, and other natural disasters.

What happens if my HOA does not have insurance?

The HOA's lack of coverage may lead to financial or legal consequences for the homeowners within the community. For example, suppose there is not enough liability coverage available from members of the HOA. In that case, each member may be required to pay additional premiums to raise sufficient liability protection for all parties involved (owners and residents).

What are the benefits of a homeowner's association?

A homeowner's association can offer several benefits to its residents, including:

  • Transparency. A homeowner's association will have open meetings where homeowners can discuss issues and vote on resolutions. It ensures that everyone has an equal say in decisions affecting their neighborhood.

  • Security. A homeowner's association will employ security measures that protect the community from crime and vandalism. These may include 24/7 monitoring, surveillance cameras, and emergency response systems.

  • Maintenance. An HOA takes care of the lawns, sidewalks, roads, parking lots, and other common areas to remain clean and safe for all residents to use.

What Should I Do If There Is A Problem With My Homeowners Association?

If you have a complaint about your HOA, it's best to take it directly to your board members. If they don't respond, talk to the management company that runs the HOA. If your issue isn't resolved, get advice from a lawyer specializing in homeowners associations or real estate law.


Do homes that have an HOA need homeowners insurance? The short answer is yes. You need to buy homeowners insurance if you live in a community with a homeowner's association. These are like condo communities, where you own your home but share expenses with other community members. It will include your share of the everyday costs in your HOA fee, which is like an HOA insurance payment for things that you can share between all the homes in your neighborhood. They will pay for common areas like parks or pools and any issues that affect multiple homes. You can expect to have your home and property insured through your HOA. Want to know more about homeowners insurance? Go to this link to find additional information and a Quick Guide on Homeowners Insurance.

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