A guest fell asleep with the bath running. Water cascaded into the unit below, destroying the neighbor’s ceiling and hardwood floors ($25,000 damage). The Condo Association’s master policy has a $10,000 deductible that they are assessing to me, and the neighbor is suing me for the rest. My standard landlord policy says “loss assessment” is capped at $1,000.
Key Takeaways
- HO-6 vs. Master Policy: The HOA Master Policy covers the “studs out” (building). You are responsible for “studs in” (your unit) and the deductible if the damage starts in your unit.
- Loss Assessment Coverage: This is the most overlooked coverage. You need at least $50,000 in “Loss Assessment” to pay the HOA deductible when they charge you for building damage.
- Liability to Neighbors: You are liable for damage to the unit below. This is “Water Damage Legal Liability.”
- AirCover’s Role: AirCover usually covers this, as it is “Host Liability” for damage to third-party property (the neighbor).
The “Why” (The Trap)
The real trap is the Loss Assessment Limit.
Most condo (HO-6) policies come with a default Loss Assessment limit of just $1,000. In 2026, however, HOA deductibles are often $10,000 and can be as high as $25,000 for water damage. If the HOA charges that deductible back to you because the leak originated in your unit, you are responsible for the difference, meaning $9,000 to $24,000 out of pocket.
The Investigation: I Called Them
- Proper Insurance: Their condo policy includes high limits for Loss Assessment and specifically covers damage to “property of others” (the neighbor’s unit).
- State Farm (HO-6): I asked to increase Loss Assessment to $50,000. It cost $12/year. That’s it. It is the cheapest, most vital upgrade.
- Airbnb AirCover: I checked if they cover the HOA deductible. They generally cover the damage to the neighbor’s unit. Whether they cover the assessment from the HOA is trickier and often depends on how the claim is presented.
Comparison Table: Condo Leak Coverage
| Feature | Standard HO-6 Policy | Upgraded HO-6 | Airbnb AirCover |
| Damage to Your Unit | YES | YES | YES |
| Damage to Neighbor | YES (Liability) | YES | YES |
| HOA Deductible (Assessment) | $1,000 limit | $50,000 limit | Unclear |
[IMAGE: Graphic illustrating a condo stack. Top unit has a blue water leak icon, bottom unit has a red dollar sign icon. Text: ‘Water runs down, Liability runs up’]
Step-by-Step Action Plan
- Read HOA Bylaws: Find the “Insurance” section. Look for the “Master Policy Deductible.” It will say something like “$10,000 per occurrence.”
- Call Your Agent: Say: “I need to increase my Loss Assessment coverage to match the HOA deductible.”
- Install Water Sensors: Put a leak detector (like Govee or Flume) near the toilet and tub. If it senses water, it alerts your phone.
- Check “Vacant” Clause: If the leak happens when no guest is there, and you haven’t visited in 30 days, standard policies might deny it.
FAQ
Does the HOA insurance pay for the neighbor’s floor?
Usually no. HOA covers the drywall (common element). The floor covering is usually the unit owner’s responsibility (or yours, since you caused the leak).
Can I sue the guest?
Yes, but AirCover is the path of least resistance. File a Host Liability claim immediately.
What if the pipe burst inside the wall?
If it’s inside the wall (common element), it’s usually the HOA’s problem, not yours. Don’t admit fault until the plumber identifies the source.