Condo Insurance Costs & Rates in Chicago

Condo Insurance Costs & Rates in Chicago

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Owners of condominiums in Chicago are not required by law to purchase condo insurance, as the structure of their home is covered by a policy paid for by the condo board.

However, it is possible that your condo board or mortgage provider requires owners to purchase condominium insurance in order to protect their homes. And even if they're not obligated to do so, we recommend that Chicago condominium owners strongly consider purchasing condo insurance.

Do I need condo insurance in Chicago?

Condo insurance isn't legally required in Chicago, but there are two scenarios in which you might be required to buy condo insurance.

According to Illinois state law, your condo association may require you to purchase coverage in order to own the unit at all. Additionally, if you have a mortgage for your condo, you will likely have to purchase condo insurance — most mortgage contracts require it.

Neither of these requirements is legally mandated in Chicago, so if you're obligated to buy, there is no specific legal minimum you must meet. But check with your lender or condo board, as they likely have a minimum required coverage amount — especially for liability insurance.

Even if condo insurance is not required, purchasing it is still an excellent idea. Also called HO-6 insurance, it goes beyond the basic protection you receive from your condo building's shared insurance, providing coverage for your home and personal property against all kinds of perils. This includes natural disasters, fire and theft, as well as liability protection.

What Chicago condo insurance covers

Condominium insurance is a type of home insurance that provides coverage similar to what's in a standard homeowners policy, with a few exceptions. This is because some elements of the property are covered by a shared policy that is paid for by everyone who lives in the building.

Condo insurance generally provides coverage for your personal property, liability protection and any structure that's considered part of the "interior" of your home. For the purposes of condo insurance, the interior includes walls, floors and any permanent fixtures such as sinks, toilets and lights.

Your policy may also include loss of use coverage, which pays for additional living expenses if you are unable to live in your home due to a covered peril, like storm-related wind damage — a common phenomenon in Chicagoland.

An additional coverage that is unique to a condominium policy is loss assessment coverage. If your building experiences a severe loss that exceeds the limits of its coverage, such as damage from a tornado or severe storm, the condo board will split the remaining expense among every condo owner using an assessment. Loss assessment coverage pays that amount, as long as the damage is caused by a hazard covered by your policy.

A separate policy protects your building's structure

The main exclusion from condo insurance — and the key difference between condo insurance and home insurance — is that it doesn't cover the structure of your condo building, including the roof, exterior walls and any areas shared by multiple residents, like hallways or the lobby. These parts of the building are covered by a shared policy paid for through your condo's association costs.

For example, if you experience a severe hailstorm that damages your building's roof and furniture on your private balcony, the roof damage would be covered by your building's shared policy. Meanwhile, you would claim the furniture under your own condo insurance policy.

What your condo association policy covers

  • Building structure, exterior walls and roof
  • The land your condo is built on
  • Common areas of your building, like hallways and lobbies
  • Shared amenities, like fitness centers and elevators

What is the average cost of condo insurance in Chicago?

We collected quotes from four leading condominium insurance providers in the Chicago area to get an understanding of how much condominium owners can expect to spend to protect their homes.

We found the average cost of condo insurance in Chicago to be $453 per year. This is higher than the Illinois average of $363, but below the U.S. average. Nationwide, the average price is $478.

Condo insurance in Chicago is also much cheaper than homeowners insurance. A typical HO-3 homeowners insurance policy in Chicago costs $1,243 per year.

However, we found a considerable difference based on the amount of coverage the condo owner purchases, as well as among different insurers.

For example, for a $12,500 dwelling coverage limit — meaning you receive a maximum payout of $12,500 for damage to your home's interior walls, flooring and other fixtures — the average price was $395 annually, a $58 difference compared to the Chicago average. And the most expensive insurance company for Chicago condo owners, Progressive/Homesite, was $222 higher than the least expensive, Travelers.
How Much Condo Insurance Costs in Chicago

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Best condo insurance companies in Chicago

We looked at top insurers in Chicago and found that Travelers consistently provided the best condo insurance prices across all coverage levels. The average price for condo insurance in Chicago from Travelers was $325 per year, a $128 savings compared to the city average.

Travelers also has excellent customer service reviews and plenty of insurance agents in the Chicago area, meaning that condo owners can meet with a local agent in person. Alternatively, Travelers customers can purchase and manage their policies online.

State Farm came in second place in our price comparison, with an average cost of $443 per year for condominium insurance. This is $10 cheaper than the average price we found for condo insurance in Chicago.

State Farm also has high customer service ratings and plenty of agents in the Chicagoland area, so it’s absolutely worth considering, especially if Travelers does not provide a quote that you find satisfactory.

Remember that every condo insurance provider calculates their rates differently, and prices may vary based on location, home type and coverage levels. You may find a better rate at a different company based on your home and needs. Always check with multiple insurers to ensure you're getting the best rates.

Editorial Note: The content of this article is based on the author’s opinions and recommendations alone. It has not been previewed, commissioned or otherwise endorsed by any of our network partners.