Question: How can my condo Association meaningfully reduce its expenses?
Answer: The Master Insurance policy is often the largest, or one of the largest, annual expenses for a Condominium Association and managing it is critical to keeping stable condo fees. Recently, skyrocketing insurance premiums have put tremendous pressure on Association budgets, but good news has finally arrived for condo owners and Boards.
Today’s column is written by Andrew Schlaffer, Founder and President of ACO Insurance and someone I recommend to any condo Board that wants to inquire about their existing or a new master insurance policy (condo or HOA). You can reach Andrew at [email protected] or (703)595-9760.
Take it away Andrew…
After three to four years of double-digit renewal increases, the condominium insurance market is genuinely improving. Commercial property insurance premiums nationally declined in early 2026, for the first time since 2017, according to a survey by The Council of Insurance Agents & Brokers.
For well-maintained, low-claim condo buildings, we're seeing typical renewal increases of just 2% to 5% — a dramatic change from the 10%+ increases that were common over the past several years. Water damage remains the leading source of claims for the DMV's aging condo buildings, followed by fire and wind/hail, but the overall cost trend is heading in the right direction for many communities.
Reinsurance is Driving the Cost Control
Much of this relief traces back to reinsurance — the backup coverage insurance companies themselves buy to protect against catastrophic losses. Reinsurance capital is at record levels, and reinsurance rates fell by double digits over the past year as capacity grew, according to industry reinsurance renewal reports. As reinsurers compete harder for business, carriers are passing some of those savings down to condo associations in the form of smaller increases — and in some cases, outright rate decreases.
Cost Control is not Applied Equally
That said, underwriting scrutiny remains high, and not every building benefits equally. Carriers continue to favor newer, fire-resistive buildings with full NFPA 13 sprinkler systems and newer roofs. Older, garden-style condos with a single means of egress and no sprinklers remain a difficult class to place, since the carrier market for these buildings is thinner, competition is lower, and claims frequency tends to run higher.
If your building falls into this category, it's generally best to stay with your current carrier unless you receive a double-digit increase — shopping the account in this segment can do more harm than good.
The umbrella/excess liability market hasn't seen the same relief. Nuclear verdicts (jury awards over $10 million) continue rising sharply, keeping capacity tight and rates firm, according to 2026 liability market data. Expect umbrella/excess liability increases in the 10% to 30% range depending on your community's loss history and risk profile.
Pillars of Insurance Reviews
Condo insurance reviews require a holistic approach, so it's important to break the cost into a few distinct categories: insurance premium, deductible expense, and out-of-pocket costs. To effectively accomplish long-term savings, all three of these categories need to be considered and addressed with a qualified insurance professional.
Adjust Coverage Responsibly to Save on Premium
Premium is certainly a factor to consider during the insurance selection process; however, available insurance products differ significantly. Coverages and services should be carefully analyzed and compared. While omitting some coverages will save premium dollars, it might also result in substantially increased costs to the Association for out-of-pocket expenses related to uncovered claims.
It is critical to work with a professional who understands local insurance needs and can adjust your insurance program in a way that maximizes premium savings while maintaining adequate insurance coverage. Some coverages may be required by statute and/or Association documents, so cutting required coverage exposes the Board to unwanted risk.
Deductibles Based on Loss History
Associations with strong financials often choose to increase their property deductibles which can provide immediate savings of 5% - 10%. Deductibles range from $2,500 to $25,000+. When considering deductibles, it is important for the Association to review their loss history in an effort to obtain an accurate estimate for deductible expenses along with notifying all unit owners of these changes so they can properly adjust their HO-6 policy.
Rate Shopping
The most common strategy employed by Associations seeking lower insurance costs is to shop their carrier. An Association can accomplish this in several ways but generally their appointed broker can offer alternative carriers to obtain the most competitive rates possible. Make sure your broker has access to all the competitive markets in order to maximize the likelihood of finding savings.
Secondly, and more importantly, if savings are found, your broker should verify that all required coverages are included, per the Bylaws and State Statute, to secure the Association's long-term financial security and lender approval. Additional savings can be realized by a thorough coverage analysis to verify the Association is not being over-insured by paying for coverage it won't use.
To ensure cost savings and long-term health of your property, make sure your insurance broker specializes in Condominium or Homeowners Associations. To maximize your savings, the Association, insurance broker, and insurance carrier need to work in harmony to identify and reduce threats to the financial health of the community.
Help Reducing Claims
One of the best ways to keep insurance costs down is to avoid claims altogether. Some examples of how insurance brokers can help reduce claims and the impact claims have on your future premium costs include coverage reviews/benchmarking, claims management services, site inspections, building upgrade recommendations, life safety planning, vendor contract reviews, discrimination/harassment training, and hiring/firing best practices.
For water damage specifically, mandatory unit inspections, water heater replacement programs, leak sensors, dryer vent cleaning, and washer hose replacement all meaningfully reduce claims frequency, per industry guidance on HOA water damage prevention. For older buildings with less favorable characteristics and a tougher claims history, the focus should shift to building improvements paired with retention and self-insurance strategies — carrying a higher deductible backed by a well-funded reserve — rather than relying on premium alone to solve the problem.
If you'd like to discuss your master condo or HOA insurance policy, reach out to the ACO Insurance President, Andrew Schlaffer at [email protected] or (703)595-9760.
If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at [email protected].
We have access to the most pre and off-market listings across the DMV of any brokerage and are happy to share what’s available with anyone who asks.
Below are some of our team’s pre/off-market listings, details and additional listings available by request:
- Ballston - 4BR/3.5BA/2,400sqft – Townhouse (2008) – N George Mason Dr Arlington VA 22203
- Lee Heights - 5BR/3.5BA/3,000 sqft – Detached (1953) – N Taylor St Arlington VA 22207
- Williamsburg Village - 5BR/4BA/3,500 sqft – Detached (1954) – 37th St N Arlington VA 22207
- Annandale VA - 4BR/3.5BA/3,000 sqft – Detached (1951) – Valleycrest Blvd Annandale VA 22003
- Capitol Hill (Washington DC) - 4BR/3.5BA/2,000 sqft – Rowhouse (1914) – South Carolina Ave SE Washington DC 20003
- Mclean VA - 5BR/4.5BA/3,700 sqft – Detached Single Family (2023) – Randolph Rd Mclean VA 22101
