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Homeownership is expensive, no matter what type of property someone owns. And the cost of homeowners insurance can vary greatly depending on where someone lives, the size of the home, and the type of insurance.

If you’re debating whether you can afford to buy a single family home or a condo, make sure to factor in condo insurance vs. homeowners insurance costs. Keep reading for the full lowdown.

What Is the Difference Between Homeowners Insurance and Condo Insurance?

The difference between homeowners insurance vs. condo insurance is fairly straightforward. Both protect homeowners financially, but the policies differ in the scope of their coverage. (Neither policy should be confused with mortgage insurance, which is totally different)

Homeowners insurance protects most of the property someone owns (inside the home, outside the home, and the surrounding area). Condo insurance protects only the interior of the home. Because multiple condos share one building, the exterior and area around the condo are the responsibility of the homeowners association (HOA) master insurance policy.

You can learn more about both types of coverage by shopping around with online insurance brokers.

How Does Dwelling Coverage Differ for Home Insurance vs Condo Insurance?

When it comes to homeowners vs. condo insurance, how dwelling coverage works varies:

•   Homeowners insurance: Dwelling coverage is based on how much it might cost to completely rebuild the home.

•   Condo insurance: How much dwelling coverage is needed is based on what the HOA master policy covers. For example, some master policies may cover select interior structures (like drywall or ceilings) or the entire interior.

Recommended: First-Time Home Buyer’s Guide

How Does Liability Coverage Differ?

For liability insurance, coverage needs can also be different for condos and homes.

•   Homeowners insurance: Liability coverage extends to the entire property (inside and outside the home).

•   Condo insurance: Covers accidents that happen inside the condo.

How Does Personal Property Protection Differ?

Personal property protection works similarly whether someone has a homeowners policy or a condo policy. This type of coverage is designed to protect the policyholder’s belongings from damage and theft. HOA master policies don’t include this coverage, so condo owners need to make sure they purchase it. Both homeowners and condo owners can benefit from personal property protection.

Cost of Homeowners and Condo Insurance by State

To get a better idea of what each type of insurance costs, let’s look at the average condo insurance vs. homeowners insurance costs by state.

As with most insurance, you can lower your premiums by choosing a higher homeowners insurance deductible.

Condo Insurance vs Homeowners Insurance Cost

Once someone is ready to buy homeowners insurance or condo insurance, price is likely top of mind. When it comes to the average condo vs. homeowners insurance cost, homeowners is $1,680 per year and condo is $429 per year.

Types of Condo Insurance

There are a few types of condo insurance to be aware of:

•   Personal property. When someone has personal property protection, they can be reimbursed for the cost of repairing or replacing their belongings, such as clothing and electronics, up to a certain amount.

•   Loss of use. If the owner needs to leave their condo to stay in a hotel during repairs after a covered incident occurs, loss of use coverage can help pay for things like hotel stays and dining out.

•   Liability. Liability coverage can help out if the condo owner is legally responsible for damage or injuries caused to someone else due to an accident that occurs in their condo.

•   Dwelling. This type of coverage steps in to pay for replacing or repairing everything in the condo unit (starting from the drywall in) after a covered loss.

•   Loss assessment. If an accident occurs in a shared area of a condo’s property (like the pool, stairs, or clubhouse), then the HOA master policy is the first line of defense. However, if damages exceed the amount that this policy will cover, then the residents may end up responsible for covering the remaining costs, which is where loss assessment coverage can come to the rescue.

Recommended: The Difference Between Homeowners Insurance and Title Insurance

Condo Insurance Benefits

While the HOA does have some insurance coverage that protects parts of condo units, residents really need to have their own condo policies to make sure they’re fully protected. The benefits of condo insurance are many, from covering repairs to replacing belongings after a break-in to paying medical bills after a guest slips and falls.

Condo owners who are still unsure what sort of policy to choose may benefit from reading How Much Home Insurance Do I Need?

Types of Homeowners Insurance

These are the main homeowners policy options:

•   HO-1: Only dwelling protection. Also known as hazard insurance.

•   HO-2: Includes personal belongings and extra perils on top of basic coverage.

•   HO-3: Includes dwelling, belongings, and liability coverage. This is the most popular type of coverage.

•   HO-4: Applies to policyholders who rent out their home and want liability and personal property coverage.

•   HO-5: This is a comprehensive policy that usually applies to brand-new homes and comes with extra coverage.

•   HO-6: The term HO-6 is another way of saying condo insurance.

•   HO-7: This type of coverage is for mobile homes.

•   HO-8: Robust coverage for older and historical homes.

It’s always possible to change homeowners insurance policies if someone decides they want more coverage.

Homeowners Insurance Benefits

The type of homeowners policy someone has influences the benefits of their policy. Generally speaking, the point of this insurance is to financially protect homeowners from disastrous events that can destroy a home, but it can also protect against theft and liability.

If you have a mortgage, homeowners insurance may be required by your lender.

The Takeaway

If someone owns a home or a condo, they need some type of insurance coverage to protect themselves from financial hardship. Homeowners policies typically include dwelling coverage for the building itself, while condo policies do not. Both cover the contents of the home, and may include liability coverage too. The average annual cost of a homeowners policy is $1,680, while the average annual condo policy is $429.

If you need a new homeowners policy, you can turn to SoFi. We teamed up with Experian to deliver homeowners insurance built for the 21st century — without brokers. Policies are customizable, and getting a quote online takes just minutes.

FAQ

What is the key difference between a homeowners and a condo policy?

The main difference between condo and homeowners insurance coverage is what each type of insurance protects. Condo insurance only protects the interior of the condo whereas homeowners insurance protects the entire property including the outside of the home and the land around it.

Which type of property insurance coverage is more expensive?

Generally homeowners insurance is more expensive (average cost of $2,777 per year) than condo insurance (average cost of $759 per year). That being said, the location, size, and repair cost of the property can lead to a condo being more expensive to insure than a single family home.

What’s the difference between HO3 and HO6?

An HO3 policy protects a single family home with dwelling, belonging, and liability coverage. An H06 policy on the other hand is designed for condo owners to protect the inside of the condo, as well as providing belonging and liability coverage.

Photo credit: iStock/miniseries

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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The average annual cost of flood insurance through the National Flood Insurance Program (NFIP) is $850 for California homeowners. But renters, who would only be insuring their personal possessions and not the building they’re in, can expect to pay much less for their coverage.

The cost of insuring your rental home’s contents still can vary significantly, depending on several factors, including if you live in a high-risk area, the coverage amount you want, and the deductible you choose.

Read on to learn more about purchasing flood insurance as a California renter, including what it can cost and why you might choose to purchase a policy to protect your belongings.

What Is Flood Insurance?

While most renters insurance policies cover some types of water damage (from a burst pipe or an overflowed toilet, for example), a standard renters policy typically doesn’t cover flood damage that comes from outside the home or from underground sources.

To be sure your furniture, electronics, and other belongings are protected if waters rise and flooding affects your rental home, you may need to buy a separate flood policy that will help you repair or replace what you’ve lost.

How Can Renters Get Flood Insurance?

Most people get their flood coverage through the NFIP, which is managed by the Federal Emergency Management Agency (FEMA). The NFIP works with a network of insurance companies across the country to provide policies.

FEMA’s flood insurance for renters and others isn’t sold directly by the federal government. Instead, you can purchase an NFIP policy through an authorized insurance company, under what’s known as a Write Your Own (WYO) program. The NFIP works with more than 50 insurance companies, so if an agent or broker helped you purchase your renters or auto policy, you can probably work with that same person or organization. If not, you can get help finding an NFIP provider online at FloodSmart.gov, or you can call the NFIP at 877-0336-2627.

You also may want to check into private, non-government-backed flood insurance policies that may be offered in your area. These policies have different coverage limits, premiums, and deductible amounts than what an NFIP policy offers and can be a good fit for some needs. Just be sure your quote is coming from a stable company that is capable of paying out claims in the event of a major flood.

What Is Covered by Flood Insurance?

The NFIP offers two types of flood coverage. You can get a policy that covers a building only, a policy that covers only the contents in the building, or you can get coverage for both a building and its contents.

It’s up to a building’s owner to decide whether to buy flood insurance for their structure. Renters only have to worry about getting coverage for the possessions they keep in their rental condo, apartment, or house.

What does flood insurance cover for renters? An NFIP contents-only policy can provide up to $100,000 in personal property damage and typically covers items like:

•   Personal belongings, including clothing, furniture, and electronic equipment (TVs, computers, etc.)

•   Valuables, such as original artwork (up to $2,500)

•   Portable and window air conditioners

•   Washer and dryer

•   Microwave or convection oven

•   Rugs

•   Curtains and other window coverings

What Isn’t Covered by Flood Insurance?

Most personal property kept in a basement — including money, furniture, clothing, and electronics — won’t be covered by NFIP flood insurance. So if you’re renting a basement apartment (even if it’s a walkout basement), you’ll want to be clear about what can and can’t be insured.

Items you keep outside the building also may not be covered under an NFIP policy, including your car, bicycle, or plants.

NFIP flood insurance also won’t cover the costs you may incur if you must move to temporary housing because of flooding damage. (If you have renters insurance with “loss of use coverage,” you may be out of luck there, too. Loss of use coverage typically pays out only when the reason you’ve been displaced is covered by your renters policy — and as noted above, the standard renters policy doesn’t cover flooding damage.)

Keep in mind that private flood policies may have different coverage exclusions.

Recommended: The Cost of Repairing a Plumbing Leak

Is Flood Insurance Required for California Renters?

Flood insurance isn’t legally mandated for renters in California, or anywhere in the U.S. And though your landlord can require renters insurance, a landlord can’t make renters purchase a separate flood policy.

However, if you feel your personal property could be at risk, you may want to consider adding flood protection.

Residents may worry more about their risk from earthquakes and wildfires, but according to the Public Policy Institute of California, much of the state is vulnerable to flooding. The valleys are susceptible to overflowing rivers. Some coastal areas are unprotected from high tides and storm-driven waves. Deserts and areas burned by wildfires may be hit by flash flooding. And urban areas with poor drainage systems and lots of concrete are at risk of flooding from heavy rains.

FEMA says just one inch of floodwater can cause up to $25,000 in damage. And without a flood policy, the cost of replacing your ruined belongings would fall to you.

How Can You Assess Your Rental’s Risk?

Knowing your designated flood zone can help you decide if you want to prioritize purchasing flood insurance for your rental. You can find your zone by entering your address at the FEMA Flood Map Service Center at MSC.FEMA.gov. Buildings in zones A and V are at the highest risk for flooding, while those in zones B, C, and X are considered at moderate risk.

Even if you don’t live in a high-risk zone, you can still experience flood damage. More than 20% of all insurance claims come from moderate- to low-risk flood zones, according to NFIP data.

If you’re new to the state or your city — or even if you’ve just moved to a new building — you may want to speak with your neighbors or landlord about the history and potential for flooding.

How Much Is Flood Insurance for Renters?

The NFIP offers contents-only policies for as low as $100 annually. Your premium can vary based on several factors, including the items you plan to protect and their replacement cost.

Remember, with an NFIP contents-only policy, the maximum amount of coverage you can get is $100,000. If your needs go beyond that threshold, you may want to consider buying excess flood insurance through a private flood policy. Or you may find a private policy alone is a better fit for you.

If it seems as though adding a flood policy on top of the cost of renters insurance might be beyond your budget, you may be able to lower the premium by raising your deductible amount. And your insurance agent can probably make other suggestions to keep the cost down.

It might make sense to sit down and look at how renters insurance for flooding would fit — along with life, car, health, and standard renters insurance — as part of your overall personal insurance planning. Don’t put off the decision to purchase until forecasters are predicting a potential flood event, though. There is typically a 30-day waiting period for an NFIP flood insurance policy to go into effect.

Recommended: Different Types of Insurance Deductibles

The Takeaway

FEMA offers flood insurance for renters, known as contents coverage, for as low as $100 a year through the National Flood Insurance Program (NFIP). But the cost of an NFIP policy or a private (non-government-backed) flood policy can vary significantly depending on where you live and what you want to protect. Flood insurance is a standalone policy, so the premium would be on top of whatever you may be paying for renters insurance. (Most renters insurance policies don’t cover flood damage.)

While SoFi doesn’t offer flood insurance, the National Flood Insurance Program offers coverage that can protect you from expensive damage.

If it’s time to reevaluate your overall insurance plan, SoFi can help. SoFi teams with top carriers to help you get reliable coverage with the convenience of shopping for insurance online. With SoFi Protect, you can search for the coverage you need — for your home and belongings, life, and car — at a price you can afford.

FAQ

Is there flood insurance for renters?

Yes. Renters can get contents-only insurance through the National Flood Insurance Program (NFIP) or a private (non-government-backed) flood policy.

Can my landlord require flood insurance?

No. Flood insurance is not legally mandated in any state, and landlords can’t require renters to carry it.

Will my bicycle, kids’ toys, and other things I store outside my apartment be covered by flood insurance?

An NFIP contents-only policy won’t cover items that are kept outside, and there are also limits on what an NFIP policy will cover in a basement.

Photo credit: iStock/Cunaplus_M.Faba

Auto Insurance: Must have a valid driver’s license. Not available in all states.
Home and Renters Insurance: Insurance not available in all states.
Experian is a registered trademark of Experian.
SoFi Insurance Agency, LLC. (“”SoFi””) is compensated by Experian for each customer who purchases a policy through the SoFi-Experian partnership.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Editor's Note: For the latest developments regarding federal student loan debt repayment, check out our student debt guide.

Your marriage status can affect your financial life in unexpected ways, and student loans are no exception. If you have an income-driven repayment plan, your spouse’s income might change your monthly payment calculation. But such challenges also present opportunities. For instance, you may be able to rejigger your student loan payments to save money on interest, lower your monthly payment, or shorten your repayment term so you can become debt-free faster.

Here we’ll show you how getting married affects student loans. Learn strategies for restructuring your debts, and tips for saving money that you can put toward other goals.

Marriage and Student Loan Repayments

Your marital status can affect everything from loan payments to tax breaks. Understanding how marriage impacts student loans (yours or your partner’s) can help you craft a new repayment plan and get ahead of your other financial goals. That way, you can focus on more urgent matters, like who’s making dinner tonight.

How Marriage and Student Loans Can Affect Your Taxes

If you paid student loan interest in the previous tax year, you may qualify for a student loan deduction. But your eligibility can change depending on if you are filing jointly or separately.

According to the IRS, as of the 2021 tax year, a single person (or head of household) with a modified adjusted gross income (MAGI) under $85,000 may be able to deduct up to $2,500 of qualified student loan interest paid in a given year. (Eligible MAGI for married filing jointly for this deduction is under $170,000.)

However, if you’re married but filing separately, that student loan interest deduction goes away. You can only take advantage if you file jointly. (See below for other deductions you may not qualify for if filing separately.)

Helping Each Other with Repayments

If you want to help your spouse with their student loan repayment, whether they have private or federal loans, you can. When one spouse takes out a loan before the marriage, typically that loan still belongs to the original borrower. However, you can choose to put both your names on the loan, and be equally responsible for the debt, by refinancing together.

Refinancing student loans gets you a brand-new loan in both your names. At the same time, you may be able to qualify for a lower interest rate or better terms. However, you will forfeit your federal student loan benefits if you refinance federal loans with a private lender.

Marriage Could Complicate Your Income-Driven Repayment Plan

When you’re married and filing separately (vs. jointly), student loan servicers count only your individual income. But if you file jointly and you or your spouse is enrolled in the Revised Pay As You Earn (REPAYE) plan — one of four income-driven repayment plans — you could see your monthly payments increase. When filing your taxes jointly, your combined AGI replaces your individual income in REPAYE’s calculations.

For the three other income-driven repayment plans — Pay As You Earn (PAYE), Income-Based Repayment (IBR), and Income-Contingent Repayment (ICR) — you can potentially avoid higher payments by filing separately. However, when you do this you lose the ability to use the student loan interest deduction.

Filing separately also means you’ll no longer be able to qualify for the Earned Income Tax Credit, the American Opportunity Credit, and Lifetime Learning Credit. There is no one blanket answer for every married couple. Given the complexity of tax law, you’ll want to consult a tax professional to determine which option is best for you both.

Tips for Tackling Student Loan Debt Together

So what’s the best strategy for paying down student loans without letting them come between you and your spouse? Here are five tips to a debt-free happily ever after.

Tip #1: Create Your Big Financial Picture

Preparing to take on a big financial goal usually requires some conversation and preparation upfront. Before making any decisions, sit down and talk about your short- and long-term financial objectives, and make sure you’re both on the same page (or as close to it as possible). This can be an overwhelming topic, so see if you can break it down into chunks.

Have you established a household budget? How do student loans — and paying them off — fit into your long-term and short-term goals? Should you start aggressively paying off debt, or might it be better for you to ramp up over time? What other factors (e.g., buying a home, changing careers, having children) might influence your decisions?

Not only can this exercise give you more clarity to create an action plan, it can also be kind of fun. After all, planning a life together is part of the reason you got married in the first place. The key is to listen to each other.

Tip #2: Take Advantage of Technology

Once you’re clear on the big picture, it’s time to get into the weeds. Many people have more than one student loan, often with multiple lenders, so a good place to start is to gather all of your loan information together. You can use an online student loan management tool (try https://studentaid.gov/loan-simulator/) to compare repayment options and analyze prepayment strategies.

After crunching the numbers, your debt payoff strategy may include putting extra money toward your loans each month, which means creating and sticking to a budget that supports that goal.

Using a debt payoff planner can help you keep track of your debt payments, maintain spending within a budget, and show how close you are to paying off your debt in full. Tracking your spending may not feel good at first, but over time, this kind of discipline can help you see where your money goes and make conscious choices about your spending. Once you have your budget in place, these apps can be set up to alert you both when spending is getting off track.

Tip #3: Define the Who, What, When

Whether your finances are separate or combined, you’ll probably want to come to an agreement on how to collectively pay all of your financial obligations. Many couples address this based on each person’s share of the total household income.

For example, if one person contributes 40% of the household income, and the other 60%, the former might pay 40% of the shared bills and the latter 60%. Others find it simpler and more cohesive to have one household checking account and pay all bills from there. Or you can combine the two tactics, and have each spouse contribute a prorated amount to the joint bank account.

However you decide to split things up, consider setting up automatic payments for all household bills, because missed student loan payments can potentially impact both spouses’ credit. And a weak credit rating can make your future financial objectives tougher to achieve.

Tip #4: Look For Opportunities to Optimize

So now you’ve established a plan and a budget, and you know who’s on point for each bill. You’re on the path to getting student loan debt off your plate. Is there anything else you can do to speed up the process?

Short of winning the lottery, the most common ways to accelerate student loan payoff are prepayment (meaning, paying more than the minimum) or lowering the interest rate, the latter of which is most commonly accomplished through refinancing.

If you qualify to refinance your student loans, you’ll have to decide on your primary goal:

•   Lower your monthly payment by choosing a longer term. This frees up money in your budget, but you’ll potentially pay more in interest over the long term.

•   Lower your interest rate. This saves you money in interest over the long term. (It can also lower your monthly payment, but don’t count on it.)

•   Shorten the repayment period. This can save you money on interest over the life of the loan, and get you debt-free faster.

Tip #5: Be on the Same Team

Living with debt is stressful for any couple. But being in a committed relationship has its advantages. There’s a reason that weight loss experts often recommend finding a “buddy” to help cheer you on and keep you honest on your diet and exercise journey. The same applies to achieving a big financial goal like paying off student loan debt.

Keep it positive and the lines of communication open, and you may find that the journey to being debt-free makes your marriage stronger.

Refinancing Student Loans Separately vs. Jointly

If you and your new spouse decide you want to do more things with your money — have a child, buy a home, or invest more in retirement savings — it may be time to refinance student loans. Once again, you’ll need to run some numbers and decide whether to refinance your student loans together or separately.

When you apply to refinance your student loans, lenders typically evaluate your credit score and financial fitness. This determines your new interest rate and loan terms. The goal is for the new loan to be a better deal than your existing loans.

With a lower interest rate, you can reduce the amount of money you spend over the life of the loan. And with only one monthly student loan payment to worry about, your finances can be easier to manage.

But are you better off going it alone or together?

Refinancing Student Loans Separately

When you’re married, refinancing your student loans separately has pros and cons.

Even if you’re married, refinancing student loans separately may be right for you if any of the following statements are true:

•   Your credit score and history are much stronger than your spouse’s, and you want to qualify for the lowest interest rate possible.

•   You and your spouse have different goals for refinancing — for instance, a lower monthly payment vs. saving money in interest.

•   Your spouse hopes to qualify for Public Service Loan Forgiveness (PSLF).

•   Your spouse is enrolled in an income-based repayment plan or is taking advantage of other federal repayment protections.

•   One of you has a much higher student loan balance, while the other has almost paid off their loans.

Refinancing Student Loans Jointly

On the other hand, there are compelling arguments for being married and refinancing student loans jointly.

Refinancing student loans jointly may be right for you given one of these scenarios:

•   Your credit score and history are much weaker than your spouse’s, and you can’t afford the interest rate and loan terms you qualify for alone.

•   You’re a stay-at-home parent with no earned income, making it difficult to qualify separately.

•   It’s important to both of you to be on the same team financially.

Refinance Student Loans With SoFi

For some couples, a lower interest rate can mean more flexibility and a more manageable repayment plan. After all, the average graduate holds 8-12 student loans. That gives married couples 16-24 different loan payments to make each month. Refinancing together can transform a student loan mess into a single, affordable payment.

To see how refinancing might impact your student loans and your partner’s, take a look at SoFi’s student loan refinance calculator. With SoFi, there are no application or origination fees, and no prepayment penalties.

FAQ

Does getting married affect student loan payments for you and your spouse?

If you or your spouse is enrolled in an income-driven repayment plan, you may see your payments increase after marriage. You can potentially avoid higher payments by filing your taxes separately. However, you’ll forfeit the ability to use the student loan interest deduction.

Is my spouse responsible for my student loans?

Loans taken out before the marriage still belong to the original borrower. Your spouse is not responsible for them unless they cosigned the loans with you. You can choose to put both your names on your loans, and be equally responsible for the debt, by refinancing together.

Does marriage affect financial aid?

Marriage typically has a positive effect on qualifying for financial aid. If you are under 24 and married, your parents’ income will no longer be considered in financial aid calculations, but your spouse’s will — this usually means your household income drops. However, if your spouse has significant income or assets, that can negatively affect your eligibility for financial aid.

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