Your HOA's bad day becomes your bill.

An HO-6 policy covers your world from the drywall in: your unit's interior and the finishes and improvements in it, your personal property, your personal liability, loss of use if the unit becomes uninhabitable, and loss assessment, which is the piece almost everyone under-buys.

It does not cover the roof, the exterior, the hallways, the pool, or the parking structure. Those belong to your HOA's master policy. The trouble is that the line between the two is not drawn by either insurance policy. It is drawn by your CC&Rs, and that is where you have to start.

Because it is the difference between a rough month and a financial emergency. When the HOA has a loss that exceeds its master policy limits, or has to pay a large master policy deductible, the board can levy a special assessment and divide the bill among all owners. That is your bill now, personally.

Loss assessment coverage on your HO-6 pays your share. The catch is the default limit: many policies include only $1,000. Meanwhile master policy deductibles have climbed to $25,000, $50,000, and higher, and after the Eaton fire, HOA emergency assessments were reported as high as $23,000 per unit for common-area reconstruction.

Raising the limit to $50,000 or $100,000 typically costs a very small amount, often reported at well under $50 a year. It is the highest value per dollar on the entire policy and one of the least commonly carried. If you own a condo in Arizona and have not checked this number, check it today.

This determines how much dwelling coverage you need, and most owners have no idea which one their building carries.

Bare walls-in covers the structure and common areas but nothing inside your unit, so your cabinets, flooring, fixtures, and interior walls are entirely your problem. Single entity (sometimes called original specifications) covers the unit as originally built, but not your upgrades. All-in or all-inclusive covers fixtures and finishes too, leaving you mainly your belongings.

The premium math is exactly what you would expect: the more the master policy covers, the more it costs the association, and the less dwelling coverage you personally need. Get the master policy declarations page from your manager or board. Under the Arizona Condominium Act your HOA has disclosure obligations here, and it is not an unusual request.

This is the most common dispute in condo living, and the answer is genuinely fact-specific. It turns on where the water came from, who owns the plumbing that failed, and whether anyone was negligent.

Roughly: water from HOA-owned plumbing, like main or shared lines, is typically the association's responsibility for the building structure, though the interior damage to your unit may still fall on your HO-6 depending on the master policy type. Water from a pipe inside your unit is typically yours, and if it floods the two units below you, your liability coverage is what answers for their damage.

Never assume the other person's policy will pick it up. And if a washing machine hose in your unit triggers the master policy, expect the association to look at you for the deductible.

Not by state law. By your lender, almost certainly, if you have a mortgage. And often by your CC&Rs, which can require unit owners to carry an HO-6, sometimes with specified minimum limits.

Even with no mortgage and no requirement, going without means the interior of what is probably your largest asset, your belongings, your liability, and your share of any assessment are all sitting on your balance sheet. For what an HO-6 costs, that is a strange bet to make.

It depends entirely on the master policy type, which is why that is question one. Under a bare walls-in master policy, you need enough to rebuild everything from the studs inward: drywall, flooring, cabinets, counters, fixtures, appliances, built-ins. In a Southern Arizona condo that is not a small number. Under an all-in master policy, you need far less.

The commonly missed piece is improvements and betterments. If you renovated the kitchen, the master policy, even a generous one, generally insures the unit as originally built, not your upgrades. That $60,000 kitchen is yours to insure, and it needs to be reflected in your dwelling limit.

No. Earthquake is excluded from a standard HO-6 and has to be written separately. For condo owners it deserves an especially close look, because you have two exposures: damage to your own unit's interior, and a special assessment if the building itself is damaged and the association's coverage is short.

That second one is the sleeper. Note also that some loss assessment coverage excludes earthquake-related assessments unless you specifically add it. On this fault network, that is a question worth asking out loud rather than assuming.

Uncomfortably, yes, and this surprises people. Loss assessment coverage is generally written so that the date of the assessment controls, not the date of the underlying incident.

So an owner can be assessed, and their coverage can respond, for an event that occurred before they bought the place. This is one more reason to actually read the HOA's minutes and reserve study before closing, and to have real loss assessment limits from day one of ownership rather than adding them later.

No, and this trips people up. The assessment generally has to arise from a peril your own HO-6 covers. A fire, a covered water loss, a liability judgment against the association: those are the shape of a covered assessment.

An assessment to resurface the tennis courts, replace an aging roof at the end of its life, or top up an underfunded reserve is maintenance, and no insurance policy pays for maintenance. If your HOA is chronically underfunding reserves, that is a real financial risk to you, and it is not an insurance problem. Read the reserve study.

Work it out rather than guessing. Get the master policy declarations page and find the highest deductible on it, across each type of peril. Then carry at least that much. If the master policy carries a $100,000 deductible, $1,000 of loss assessment coverage is decoration.

Also look at the association's liability limits, since a judgment exceeding them gets divided among owners the same way. Moving from $50,000 to $100,000 of coverage is often reported at only $30 to $50 more a year. Bring us the master declarations page and we will size it with you.

It means your exposure just grew, and you should look at your own policy now rather than later. Arizona's condo market has tightened hard: major insurers have pulled back on condo building coverage, in some reported cases cutting limits dramatically, and wildfire-area associations have been non-renewed outright.

When a master policy shrinks, the gap does not disappear. It moves to the owners, in the form of larger assessments when something happens. So the same year your HOA's coverage gets worse is the year your loss assessment limit matters most. If your board sent a notice about the master policy, bring it to us.

Then you need a different policy. An HO-6 is written for an owner-occupant, and once tenants live there you are a landlord, with a landlord policy covering the unit, your liability, and your lost rent.

Your tenant covers their own belongings with renters insurance, which your lease should require. And your CC&Rs may have their own rules about renting at all, including caps on rental units in the building. Tell us before the tenant moves in, not after a claim.