HOA glossaryMoney

What is Master Insurance Policy?

The master policy is the association's insurance covering common property and, depending on its type, some portion of individual units.

Master policies come in flavors. 'Bare walls' covers the structure and common elements but not interior finishes. 'Single entity' adds original fixtures and finishes. 'All-in' or 'all-inclusive' covers interiors as originally built, leaving owners responsible mainly for personal property and improvements.

Owners fill the gap with an HO-6 policy covering personal property, interior improvements, loss assessment coverage for special assessments after a loss, and liability.

The master policy deductible matters enormously. On large deductibles the declaration or state law determines whether the association or the affected owner absorbs it — a five-figure question after a burst pipe.

Related terms

Maintenance ResponsibilityMaintenance responsibility is the allocation, defined in the governing documents, of which repairs the association pays for and which the owner pays for.Common AreaCommon area is the property owned or maintained by the association for the shared use of all owners — streets, pools, clubhouses, landscaping, and open space.Special AssessmentA special assessment is a one-time charge levied on owners to cover a large expense that the regular budget and reserves cannot absorb.

Answers straight from your own documents

Melo tells residents what Master Insurance Policy means in your community — citing the exact page of your CC&Rs, budget, or rules.