State laws pertaining to condominiums and most project legal documents creating condominiums require the association to carry a master insurance policy covering the entire project including the individual units. This is the only approach to insurance that makes any sense in a high rise project, and in most lateral projects it also makes sense because of the interrelationship of individual condominium units and the
project's common areas. In planned unit developments, the advisability of having a master policy depends to some extent on the type of construction. With attached townhouses or row houses, it is possible that a master policy is preferable to individual policies covering each dwelling. A master policy may cost less
money than a collection of individual policies; it is also easier to insure adequate coverage for the entire project with a master policy than it is with individual insurance policies issued by different companies.  Usually the developer of a project will have purchased an insurance policy that will be in effect at the time the board of directors is taken over by the new owners.

To read more about association insurance, click here.