HOA & condo insurance requirements in Virginia

A board changes management companies and finds the master policy it inherited does not match what its declaration requires. Or a lender rejects the community's coverage two weeks before a closing, and the board hears it from a real estate agent.

Both are common and both fixable. HOA insurance requirements in Virginia come from three places and only one is state law. Virginia requires exactly one policy of every association. Everything else comes from your governing documents and from the lenders your owners borrow from.

This guide covers all three sources, what each policy protects, where the master policy ends and an owner's HO-6 begins, and an annual review list for your board.

Where HOA insurance requirements come from

Your HOA insurance requirements come from three places: Virginia statute, your governing documents, and the lenders your owners borrow from. Statute sets a floor, the documents set the detail, and lenders set what the community must look like for a buyer to finance.

The documents almost always carry the most detail, so the declaration and bylaws are the first thing a board should pull. They name the policy types, set minimum amounts, and divide who insures what between association and owner. The Community Associations Institute points boards to the same three sources and recommends working through them with a qualified insurance professional.

What Virginia law requires

Virginia requires every association that collects assessments to carry a fidelity bond or employee dishonesty policy, and condominiums have additional HOA insurance provisions under the Condominium Act. This is the kind of statutory detail a management team applies daily, and Landmarc has done it across 200+ communities for more than 30 years.

Every association: a fidelity bond

Under Va. Code § 55.1-1827, any association collecting assessments must maintain a blanket fidelity bond or employee dishonesty policy. It insures the association against theft or dishonesty by its officers, directors and employees, and by any managing agent and its employees.

Because the formula runs off reserves, the required amount climbs as reserves grow, so the bond needs rechecking every year rather than once at purchase. A community that funded reserves well for five years can fall below the statutory amount without anything about the policy changing.

Condominiums: what the Condominium Act adds

Va. Code § 55.1-1963 says the condominium instruments may require the association to carry a master casualty policy at full replacement value of the structures and a master liability policy covering the association, the board, the managing agent and unit owners. Read that carefully: the statute authorizes the instruments to require those policies, it does not mandate them itself. Subsection B applies the same fidelity requirement to condominiums. Subsection C adds an obligation boards forget: when the association obtains a policy, it must promptly give every unit owner written notice of it and of any later change or termination.

Insurance shows up in every resale packet

Under § 55.1-2310, item 14, the resale certificate must describe the association's insurance including fidelity coverage, name any coverage owners are recommended or required to carry, and state that the documents may make an owner responsible for all or part of a deductible. Your HOA insurance is disclosed to every buyer, so gaps become visible at the worst possible moment.

What does HOA insurance cover? The core policies

HOA insurance typically combines a master property policy, general liability, directors and officers coverage, and fidelity or crime coverage, with workers' compensation and umbrella coverage depending on the community.

The HOA master insurance policy is what most boards think of first, but D&O insurance is what protects volunteers personally. Check how your D&O policy defines an insured, and whether it reaches committee members and the managing agent, because those definitions vary more than the limits do. Workers' compensation turns on whether the association has employees of its own rather than contracted vendors. Umbrella coverage sits above the rest and is usually a judgment call.

HOA vs. condo: how the master insurance policy differs

In most HOAs the association insures only the common areas it owns, and each homeowner insures their own house. In a condominium, the master policy usually covers the buildings themselves. That one difference drives most of the confusion between the two.

A condo master insurance policy comes in three structures, and your declaration decides which applies.

Boards get into trouble when they assume a structure rather than reading for it, because the three look alike until a claim forces the question. Mixed-use buildings and commercial condominiums add a layer, which is much of what our condo association management work involves.

Where the master policy ends and the HO-6 begins

The master policy covers what the association is responsible for. The owner's HO-6 covers the unit interior as the documents define it, personal property, personal liability, and often the owner's share of a master-policy deductible. Comparing HOA insurance vs homeowners insurance misses the point: an HO-6 sits on top of a master policy rather than duplicating it.

Loss assessment coverage is the piece owners most often lack; it helps an owner pay a special assessment after an association loss. Tell owners plainly what the master policy does and does not cover, because an owner who buys the right HO-6 does not become a dispute after a claim.

Lender requirements your board can't ignore

If owners in your community finance with conventional mortgages, your master policy also has to satisfy secondary-market lender standards. Fannie Mae's Selling Guide B7-3-03 sets the ones most Virginia communities meet, and as of 2026 it requires master property coverage of at least 100% of the estimated replacement cost value of project improvements, a maximum per-occurrence deductible of 5% of the coverage amount, and a maximum per-unit deductible of $50,000.

A master policy is required for condo projects unless the legal documents require individual policies per unit. For a PUD, individual policies are the default, and Fannie Mae accepts a master policy only where the project's documents provide for one. Coverage that falls short can complicate a buyer's financing and drag on resale across the community.

How your board should review coverage every year

Review coverage at least once a year, ideally before the budget is set, by checking each policy against your documents, Virginia law and lender standards. Inadequate HOA insurance is one of the gaps our team routinely finds on taking over a community, alongside unsigned vendor contracts and governance that drifted. We raise it immediately, even when that makes for an uncomfortable first meeting.

The review itself is a checklist, not a project:

• Match each declarations page against what the governing documents require.
• Confirm the replacement-cost valuation is current, not carried forward.
• Recalculate the fidelity bond against current reserves.
• Decide and document who pays the deductible, then tell owners.
• Confirm D&O limits and who is insured.
• Collect current certificates of insurance from every vendor.
• Give owners the written notice of changes the statute requires.
• Build the premium into the budget before the draft goes out.

Every finding has a cost, and finding it in March is cheaper than finding it at renewal. This review is part of full-service HOA management, and associations on financial-only engagements receive insurance oversight too. This is general information rather than legal or insurance advice; work through specifics with association counsel and a qualified insurance professional.

Frequently asked questions

Is an HOA required to have insurance in Virginia?

Yes. Every Virginia association that collects assessments must carry a blanket fidelity bond or employee dishonesty policy under § 55.1-1827. Property, liability and D&O coverage are different: those HOA insurance requirements come from your governing documents and lender standards, not statute. Condominiums have additional provisions under § 55.1-1963.

What does a condo association insurance policy cover?

Usually the building structure and common elements, plus the association's liability, with the dividing line set by whether the master policy is written bare walls, single entity or all-in. Your declaration determines which applies. Read it alongside your HO-6 to see which side of the line your flooring, cabinets and fixtures fall on.

Can an HOA require homeowners to carry insurance?

Yes, if the governing documents require it. Virginia resale certificates must disclose any insurance owners are recommended or required to carry under § 55.1-2310, item 14, so the requirement should be written into the documents and communicated rather than assumed.

How do I get a copy of my HOA's master insurance policy?

Ask your board or management company. Many associations share a certificate of insurance or a policy summary on request. Condominium owners have a stronger position: under § 55.1-1963(C) the association must give written notice when it obtains a policy and when that policy changes or terminates. Buyers see the details in the resale certificate.

Do HOA fees include insurance?

Usually yes. The association's premiums are a common expense funded through assessments, so your fees already pay for the HOA insurance policies the association carries. They do not cover your own homeowners or HO-6 policy, which you buy separately.

Three sources, one annual check

Statute, documents, lenders. Run your coverage against all three once a year and the surprises stop arriving at closings and renewals.