CONDO OWNERSHIP
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A hailstorm takes out your roof. The contractor's estimate is $28,000. The adjuster's check is $9,400. Nothing went wrong in that sequence. The policy did exactly what it was written to do. The owner just found out what it said at the worst possible moment.
What hazard insurance covers depends on three things that are all printed on your declarations page: which perils the form insures against, which losses it excludes, and how it values what it does pay. Get those three straight and the check stops being a surprise.
This is the coverage-scope question. If you're still sorting out what hazard insurance is and why your lender demands it, start with our explanation of hazard insurance and the mortgage requirement, then come back here for what it actually pays for.
Leevli EditorialLast updated 2026-09-17
Every property policy takes one of two approaches, and the Texas Department of Insurance draws the line cleanly:
That difference reverses who has to prove what. Under a named-perils form, a loss is covered only if you can place it inside a listed category. Under an open-perils form, the loss is covered unless the insurer can point to an exclusion. Same damage, different starting position.
The industry's standard HO-3 homeowners form enumerates the perils it insures personal property against. Verbatim from the form:
Most owners assume their policy is one thing or the other. In the standard HO-3 it is both. The building is open perils and your belongings are named perils. The form insures "against risk of direct physical loss" for the dwelling and other structures, subject to exclusions. For personal property it insures "for direct physical loss to the property described in Coverage C caused by any of the following perils," and then gives the list above.
So a loss that damages both your walls and your furniture can be evaluated under two different standards in the same claim. That is normal, and it is invisible unless you read the Perils Insured Against section.
Condo owners have an extra wrinkle: HO-6 unit-owner forms vary a great deal between carriers, and some cover interior finishes on a narrower basis than owners expect. Sizing that policy against your specific building's master policy is its own exercise, and we walk through it in how much condo insurance you need. The building side of the equation sits in the condo association master insurance policy.
The Insurance Information Institute lays out the standard proportions, and most policies follow them unless you change something:
Those sub-limits are where high-value items quietly fall out of coverage. A standard policy's internal caps on jewelry, firearms and collectibles are often a fraction of what the items are worth, which is what floaters and scheduled endorsements exist to solve.
"Flood damage is excluded under standard homeowners and renters insurance policies," the III states flatly. FEMA's NFIP says the same from the other direction: most homeowners insurance does not cover flood damage.
Two details about NFIP coverage catch owners out. Personal property claims under an NFIP policy "are always paid based on ACV," meaning actual cash value with depreciation deducted. Certain valuables including artwork, furs and jewelry are capped at $2,500 under contents coverage. Flood coverage is not a more generous version of your homeowners policy. It is a narrower one, aimed at a specific peril.
Excluded on standard forms. So, generally, are landslide, mudslide and sinkhole, which the III groups with the "special exclusions" that also include war and nuclear accident. Some states have their own statutory or program-level answers, Florida for sinkholes and California for earthquake, so check your state's rules rather than assuming.
"Your insurance policy will not cover damage due to lack of maintenance." A 25-year-old roof that finally gives up is not a peril. A roof torn off by a windstorm is. Adjusters spend a lot of their time on that boundary, and deferred maintenance is the single most common reason a claim gets reduced rather than denied outright.
Infestation from termites or other pests is excluded. Mold is more nuanced: Texas regulators describe the standard treatment as policies that "won't cover mold removal, except to repair damage caused by a covered risk." Mold following a burst pipe may be covered. Mold from a humid bathroom and a slow leak you didn't address is not.
"Sewer backups are not covered under a typical homeowners insurance policy." This is an endorsement in almost every market, it's inexpensive relative to the loss it prevents, and ground-floor and basement units are exactly the ones that need it.
Knowing the peril is covered answers half the question. The other half is how much of the loss you absorb before the insurer pays anything. For wind and hail, that figure is frequently written as a percentage of your insured value rather than a flat dollar amount.
The NAIC reports that these deductibles range "from 1% to as high as 15%" of a home's insured value, apply only when contract parameters spelled out in state law or the policy are met, and that as of June 2025, nineteen states and the District of Columbia have some form of hurricane or named-storm deductible in place. The list runs Alabama, Connecticut, Delaware, Florida, Georgia, Hawaii, Louisiana, Maine, Maryland, Massachusetts, Mississippi, New Jersey, New York, North Carolina, Pennsylvania, Rhode Island, South Carolina, Texas and Virginia.
This is not only a coastal phenomenon. Colorado's Division of Insurance warns residents after hailstorms that "many policies will have wind / hail deductibles that are a percentage of your coverage (for example, 1%, 2% or 5%)."
Run the arithmetic on your own declarations page:
That $28,000 hail roof at the top of this article, under a 5% deductible, produces no claim payment at all.
Texas adds a further step: along the coast, a home policy "might not cover wind and hail damage" at all, and owners buy a separate windstorm policy, from the Texas Windstorm Insurance Association if private carriers decline them. Assume nothing about wind until you've read the form.
Once the peril is covered and the deductible is met, valuation decides the payment. The NAIC's definitions:
The Texas Department of Insurance states the relationship in one line: actual cash value coverage pays replacement cost minus depreciation.
Two things follow that owners rarely expect. First, replacement cost policies usually pay in two installments: the depreciated value up front, then the withheld depreciation once you complete the repair and document it. Second, many carriers in hail-prone states now schedule roof payments to ACV after the roof passes a certain age, even when the rest of the policy is replacement cost. That provision varies by carrier and by state. Ask your agent where your roof sits on that schedule.
Coverage questions become concrete when they're about a specific building in a specific market. A 1980s oceanfront tower in South Florida and a three-year-old mid-rise ten miles inland carry entirely different claim histories, deductible structures and assessment risk. None of that shows up on a listing page.
If you're weighing a coastal purchase, start by understanding the market you're buying into: our Fort Lauderdale area guide is a useful place to ground the decision. Then ask residents of the building itself what happened the last time a storm came through. People who have filed a claim there will tell you more in five minutes than any brochure.
Policy language tells you what should happen after a loss. An owner who has already filed in that building tells you what did.
Listings show the property, but they rarely explain the lived reality around it. On Leevli, a mover can explore the city, review neighborhood and building information, and ask a verified resident the specific questions that remain unanswered. That human layer helps readers know what to investigate before signing a lease, making an offer, or choosing between two addresses.
On a standard homeowners form, the dwelling is written on an open-perils basis, so any sudden physical loss is covered unless the policy excludes it. Personal property is usually written on a named-perils basis, covering fire, lightning, windstorm, hail, explosion, theft, vandalism, falling objects, the weight of ice and snow, and the rest of the listed events. Your declarations page names the form that applies.
The standard HO-3 lists fire or lightning, windstorm or hail, explosion, riot or civil commotion, aircraft, vehicles, smoke, vandalism or malicious mischief, theft, falling objects, weight of ice, snow or sleet, accidental discharge or overflow of water or steam, sudden and accidental tearing apart, cracking, burning or bulging, freezing, sudden and accidental damage from artificially generated electrical current, and volcanic eruption.
Named perils covers only the events written into the policy, so you have to fit your loss into a listed category. Open perils, also sold as all risk, covers any event the policy does not specifically exclude, so the insurer has to point at an exclusion to deny it. The damage can be identical and the outcome different depending on which form applies.
Flood is excluded on standard homeowners and renters policies. So are earthquake and earth movement, which usually sweeps in landslide, mudslide and sinkhole, along with war and nuclear accident. Damage from lack of maintenance, wear and tear, termites and other pests, and sewer or drain backup also sit outside the form. Several of those are available as separate policies or endorsements.
Windstorm and hail is a covered peril, so storm damage to a roof generally qualifies. Two things shrink the payment. The wind and hail deductible is often a percentage of insured value rather than a flat amount, and many carriers in hail-prone states pay older roofs at actual cash value even when the rest of the policy is replacement cost. A roof that simply wore out is not a covered loss at all.
It depends on where the water came from. Accidental discharge or overflow from plumbing, heating or an appliance is a listed peril, so a burst supply line is normally covered. Rising water from outside the home is flood, which is excluded and needs an NFIP or private flood policy. Sewer and drain backup is excluded too and requires a water backup endorsement, which is cheap compared with a flooded lower floor.
It is calculated against your insured value rather than set as a flat dollar figure. The NAIC reports these deductibles running from 1% to as high as 15%. On a $600,000 dwelling limit, 2% means $12,000 comes out of your pocket before the insurer pays, and 5% means $30,000. Nineteen states and the District of Columbia had some form of hurricane or named-storm deductible as of June 2025.
The property side covers the dwelling, other structures at roughly 10% of dwelling coverage, personal property at 50% to 70%, and additional living expenses under a separate limit. Liability and legal defense costs sit in their own coverage, which the Insurance Information Institute suggests starting around $100,000. Internal caps on jewelry, firearms and collectibles are low, which is what scheduled endorsements are for.
Replacement cost pays to repair or replace with materials of like kind and quality. Actual cash value pays that figure minus depreciation for age and wear, and the NAIC warns it often does not pay enough to fully replace the property. Replacement cost claims usually arrive in two payments, with the withheld depreciation released only after you finish the repair and send documentation.
Only as a consequence of a covered loss. Texas regulators describe the standard treatment as policies that will not cover mold removal except to repair damage caused by a covered risk. Mold that follows a burst pipe you reported promptly is usually part of that claim. Mold from a slow leak, a humid bathroom or a repair you postponed is treated as maintenance and denied.
Editorial review: verify current federal and state law, insurance regulations, HOA and condominium statutes, and lender guidelines before relying on any single claim. This article is informational and does not constitute legal, financial, tax or insurance advice.
