Top 3 Recommended Policies
By: Lance Hale
Licensed Commercial Insurance Specialist
425-320-4280
The condominium market in Washington has expanded rapidly over the past decade, with the state now ranking among the most densely populated condo states west of the Mississippi. While soaring high-rise towers dot Seattle’s skyline, mid-rise buildings and townhome-style condominiums continue to appear in Tacoma, Spokane, and the fast-growing Tri-Cities. Every new building brings exciting lifestyle possibilities—yet also a complex web of financial responsibilities. Condominium insurance sits at the heart of that web, protecting both individual owners and associations from the unexpected. Because Washington’s climate, seismic profile, and unique legal statutes differ markedly from those of other regions, it is critical for condo owners to understand how policies work here, what coverage gaps frequently arise, and which endorsements could mean the difference between a minor inconvenience and a major financial setback.
The Modern Washington Condominium Landscape
More than 442,000 Washington households now live in multifamily residential units, according to the 2023 U.S. Census American Community Survey. Roughly a quarter of those households occupy condominiums, many located in King, Pierce, and Snohomish counties. Demand remains high thanks to the state’s strong job market and limited single-family housing supply. Developers have responded by constructing mixed-use towers in downtown cores and master-planned condo communities near transit corridors, attracting owners ranging from first-time buyers to downsizing retirees. The sheer diversity of building ages and construction types—from 1970s wood-frame walk-ups in Bellingham to glass-and-steel luxury penthouses in Bellevue—creates vastly different risk profiles that insurance carriers must price into their policies.
That diversity also complicates how master associations and unit owners allocate maintenance obligations, deductible levels, and reserve contributions. A 2022 survey by Community Associations Institute (CAI) estimated that nearly 58 percent of Washington HOAs increased insurance deductibles over the last five years to keep overall premiums manageable. When deductibles rise, unit owners bear a greater portion of repair costs after a covered loss—making the quality of individual condo insurance policies more important than ever.
In addition to the financial implications of these changes, the evolving landscape of condominium living in Washington reflects broader societal trends. As urban areas continue to grow, many residents are seeking the convenience and lifestyle that comes with multifamily living. This shift is particularly evident in cities like Seattle, where a vibrant cultural scene, access to public transportation, and proximity to workplaces make condominiums an attractive option for young professionals. Furthermore, the rise of remote work has led to an increased interest in properties that offer amenities such as coworking spaces, fitness centers, and communal areas, catering to a demographic that values both flexibility and community.
Moreover, the environmental impact of condominium living cannot be overlooked. With a growing emphasis on sustainability, many new developments are incorporating green building practices, such as energy-efficient systems, sustainable materials, and eco-friendly landscaping. These initiatives not only appeal to environmentally conscious buyers but also contribute to the long-term viability of urban living. As Washington continues to navigate the balance between growth and sustainability, the condominium market will likely play a pivotal role in shaping the future of housing in the region.
Condominium Insurance Defined
Condominium insurance is typically divided into two principal layers. The first layer is the master policy purchased by the association, which insures shared elements such as exterior walls, roofs, hallways, elevators, amenity spaces, and liability exposures for the common areas. The second layer is the individual unit-owner’s policy—often labeled an HO-6 policy nationwide or a condo owner policy in Washington marketing materials. This personal policy covers the owner’s interior walls, built-in fixtures, appliances, personal possessions, personal liability, loss of use, and, in certain circumstances, assessments charged by the association.
Because each Washington condo declaration can assign maintenance responsibilities differently, there is no single “standard” division of coverage. Some declarations specify “bare walls” master coverage, leaving cabinets, flooring, and wall finishes to the individual owner. Others provide “walls-in” or “single entity” coverage, insuring original fixtures but placing responsibility for subsequent upgrades on the owner. Understanding these distinctions before choosing limits or endorsements remains the cornerstone of sound condo risk management.
In addition to the basic coverage provided by both the master policy and the individual unit-owner’s policy, condo owners may also want to consider additional endorsements or riders that can enhance their protection. For instance, personal property coverage can be expanded to include high-value items such as jewelry, art, or collectibles, which may not be fully covered under a standard policy. Additionally, loss assessment coverage can be a crucial component, as it protects unit owners from unexpected costs arising from shared liabilities, such as damage to common areas or legal fees resulting from a lawsuit against the association. These additional layers of protection can provide peace of mind and financial security in the event of unforeseen circumstances.
Moreover, it’s essential for condominium owners to regularly review their insurance policies to ensure they align with any changes in their personal circumstances or the condominium association’s regulations. Changes in ownership, renovations to the unit, or updates to the master policy can all impact the adequacy of coverage. Engaging with an insurance professional who specializes in condominium insurance can be invaluable, as they can provide tailored advice and help navigate the complexities of coverage options, ensuring that owners are adequately protected against potential risks while maximizing their investment in their property.
Washington State Legal Framework
The Washington Condominium Act (RCW 64.34) governs most properties recorded after July 1, 1990, while older condominiums may still fall under the Horizontal Property Regimes Act. The statutes require associations to maintain property insurance “to the extent reasonably available” on the common elements and, unless the declaration states otherwise, on the units themselves. Importantly, the law also obligates the master policy to cover per-occurrence losses up to the full replacement cost of the insured property. When the association’s policy covers the units, the statute gives the insurer subrogation rights against owners who negligently cause damage.
Washington further mandates liability coverage for the association and grants the board discretion in choosing deductible levels. If a loss originates in a unit, the law allows the association to assess the responsible owner up to the deductible amount, provided the governing documents authorize such an assessment. Courts have generally upheld these assessments as long as the board follows reasonable procedures and the deductible aligns with industry norms. These legal guidelines underscore why every prospective condo buyer should read the recorded declaration and bylaws in conjunction with an insurance professional before closing.
Master Policy vs. Unit-Owner Policy
Many Washington condo owners assume the association’s insurance fully protects their homes. Unfortunately, that assumption has produced some unpleasant surprises—particularly when water line failures or kitchen fires damage multiple units. The master policy’s first dollar threshold is its deductible, now commonly set between $10,000 and $50,000 in urban centers. If a dishwasher leak originating in Unit 701 causes $18,000 in building damage, the unit owner may be on the hook for all or part of the deductible, while any upgrade finishes or personal belongings would fall entirely under the unit-owner’s policy.
Insurance experts therefore recommend that owners carry “building property” limits equal to the estimated cost to replace walls-in components for their specific unit, not just an arbitrary figure. Owners should also confirm whether the policy includes Loss Assessment coverage—an essential safeguard that helps pay assessments levied to cover the association’s deductible or a loss exceeding the master policy’s limits. Most carriers offer $50,000 or higher Loss Assessment endorsements, and recent Washington claim data show that condo owners with these limits avoid out-of-pocket surprises roughly 73 percent more often than those with only the default $1,000 coverage.
Breaking Down Key Coverage Components
Building Property and Betterments
“Building property” under an HO-6 policy insures interior features such as drywall, flooring, cabinetry, countertops, and fixtures that are either owner-installed or not covered by the master policy. In Washington’s competitive condo market, even modest upgrades can add tens of thousands of dollars in value, making it prudent to document alterations and adjust coverage annually. Photographs, receipts, and contractor invoices greatly streamline the claims process should a covered loss occur.
Personal Property
Unlike the structural components, personal property includes furniture, clothing, electronics, and décor. Carriers typically extend special sub-limits—$2,500 for jewelry or $1,000 for artwork, for example—so owners with higher-value collectibles often schedule items separately. Washington’s theft-rate statistics from the FBI’s 2022 Uniform Crime Report indicate that multifamily dwellings experience 29 percent of the state’s reported larcenies, making adequate personal property limits essential.
Loss of Use (Additional Living Expenses)
If a fire or water loss renders a condo uninhabitable, Loss of Use coverage pays for temporary housing, meals, and incidental costs. The cost of short-term rentals in Seattle has climbed 34 percent since 2020, according to AirDNA analytics, prompting many Washington carriers to recommend Loss of Use limits of at least 40 percent of personal property coverage.
Personal Liability and Medical Payments
Liability coverage shields an owner from third-party bodily injury or property damage claims arising within the unit. Washington courts apply a “comparative negligence” standard; therefore, even partial fault can trigger settlements or judgments. Limits of $300,000 have long served as a baseline, yet umbrella liability policies—providing an extra $1 million or more—remain cost-effective for owners with significant assets.
Loss Assessment
As mentioned earlier, Loss Assessment coverage reimburses an owner for association-levied assessments resulting from a covered peril. Given the trend toward higher master-policy deductibles, a $50,000 limit is becoming the Washington norm, with some carriers now offering $100,000 endorsements for minimal additional premium. Without adequate Loss Assessment protection, an owner could receive a sudden bill that rivals a year’s mortgage payments.
Unique Risks in Washington
Washington’s lush scenery and geologic forces present hazards seldom encountered in other states. The Pacific Rim’s tectonic volatility places most of the population in moderate-to-high earthquake zones. The U.S. Geological Survey estimates a 15-percent probability of a magnitude 6.8 or greater event within the next 50 years on the Seattle Fault alone. Standard condo insurance excludes earthquakes, but carriers offer endorsements or standalone earthquake policies with “deductibles” calculated as a percentage—commonly 10–20 percent—of the insured value. When an association purchases an earthquake master policy, individual owners may still need supplemental coverage for interior improvements and personal property.
Flooding also remains a concern, especially in riverfront communities like those along the Columbia and Snohomish rivers. Because the National Flood Insurance Program (NFIP) treats condos as either residential buildings or units, associations and owners must coordinate closely to meet NFIP guidelines. Many Pacific Northwest owners overlook flood endorsements, assuming rain-related water damage is the same as flooding—yet insurers define flood as the “rising of surface water,” distinct from a roof leak or pipe break. Wildfire, hail, and windstorm threats vary statewide, but the 2020 Labor Day fires underscored that even western Washington can experience catastrophic wildfire smoke and orb damage, prompting carriers to reassess underwriting models.
Cost Factors and Premium Averages
Washington condo insurance premiums generally range from $350 to $700 per year for a 1,000-square-foot urban unit, with statewide data compiled by the National Association of Insurance Commissioners (NAIC) putting the 2022 average at $488. Several variables influence rates: building age, construction type, security features, claims history, credit-based insurance score, deductible selection, and chosen endorsements. Seattle units in 30-story steel-and-concrete towers often cost less to insure than 1980s wood-frame walk-ups in wetter regions because concrete withstands fire and water damage more effectively. Conversely, a luxury owner who installs high-end finishes may pay higher premiums to reflect greater replacement values.
Most carriers offer discounts for centrally monitored fire alarms, sprinkler systems, bundled auto policies, and claims-free histories. Raising a deductible from $500 to $1,000 commonly saves 8–12 percent, though owners should balance savings against cash-flow capability during a claim. Because Washington’s insurance market is competitive—over 20 carriers write HO-6 policies statewide—shopping and comparing quotes every two to three years can yield noticeable savings without sacrificing coverage.
Evaluating and Selecting the Right Policy
Purchasing the right condo policy begins with confirming how the association’s master policy defines “covered property.” Obtaining the condo declaration, the insurance certificate, and a copy of the master policy’s declaration page allows an agent to recommend proper building property limits. Replacement-cost estimators use square footage, finish quality, and local labor rates to approximate rebuilding expenses, and updating those values annually keeps coverage aligned with inflation—crucial in a state where construction costs rose 8.6 percent in 2022 alone, according to Rider Levett Bucknall’s Cost Report.
Beyond analyzing numbers, owners should evaluate carrier reputation, claims-service ratings, and financial strength. Washington’s Office of the Insurance Commissioner maintains an insurer complaint index that ranks carriers based on justified grievances per premium dollar. Policies with responsive claims teams and transparent communication frequently save owners time, stress, and money when losses occur.
The Claims Process in Washington
When a loss occurs, quick action can drastically reduce damage and accelerate settlement. Washington law requires policyholders to take reasonable steps to prevent further damage—such as shutting off water supply or boarding broken windows—before the adjuster arrives. Failure to do so can result in partial claim denial. Owners should document every step: photos of the damage, invoices for emergency repairs, and written communication with the association. If the loss involves common elements, notifying the board or management company immediately ensures the master policy is triggered appropriately.
Once the claim is filed, Washington’s “fair claims handling” regulations (WAC 284-30-330) force insurers to acknowledge receipt within ten business days and accept or deny the claim within fifteen business days of receiving completed proof-of-loss statements. Policyholders who feel their carrier has violated these regulations can file a complaint with the Office of the Insurance Commissioner, which mediates disputes and can impose fines on non-compliant insurers.
Frequently Overlooked Endorsements
Besides earthquake and flood, several endorsements enhance Washington condo protection. “Water backup and sump overflow” covers damage from blocked drains—a growing issue in older Seattle buildings. “Equipment breakdown” protects HVAC systems and smart-home devices against mechanical failure. “Cyber liability” is gaining popularity in luxury condos where residents maintain home-offices with sensitive client data.
Legislative Trends and Future Outlook
Washington lawmakers continue reviewing proposals to require stronger reserve funding and more comprehensive master policies in response to aging infrastructure and recent high-profile building failures nationwide. While no sweeping reforms have passed yet, industry observers anticipate tighter disclosure rules for associations and possible mandates for periodic structural inspections. Should such measures become law, master policy premiums could rise, making robust Loss Assessment coverage even more critical for individual owners.
Checklist and Closing Thoughts
Washington’s vibrant condominium scene delivers convenience and community, but it also introduces risks that differ from those of single-family homes. Owners who (1) analyze their association’s master policy, (2) purchase adequate building property and personal property limits, (3) secure high Loss Assessment coverage, and (4) consider earthquake and flood endorsements place themselves in the best position to weather unexpected events. Given the state’s dynamic real estate growth and evolving climate threats, revisiting coverage annually with a trusted insurance professional provides peace of mind and financial security for the years ahead.