Texas does not have one association insurance rule. It has two regimes, and four separate entities.
Most guidance written for Texas associations treats “HOA insurance” as a single subject. Texas law does not. Which statute governs your association determines whether it faces a statutory insurance mandate or whether its obligations come entirely from its own governing documents.
Condominium associations. Section 82.111 of the Texas Uniform Condominium Act requires the association to maintain, to the extent reasonably available, property insurance on the insurable common elements against all risks of direct physical loss commonly insured against, in a total amount of at least 80 percent of replacement cost or actual cash value — plus commercial general liability including medical payments, in an amount set by the board but not less than the declaration specifies.
Residential subdivision associations.Chapter 209, the Texas Residential Property Owners Protection Act, contains no insurance requirement at all. For a subdivision property owners’ association, insurance obligations arise from the declaration, from lender requirements and from other applicable law — not from Chapter 209. That is an inference from the absence of a provision, and a specific association may face obligations from instruments this page cannot see.
Which organization purchases this insurance?
A community association, its property management company, its board of directors and its individual unit owners are separate legal entities with different responsibilities, different insurance obligations and different sources of liability. Understanding where one insurance program ends and another begins is essential to effective risk management.
The most common and most costly assumption in this field is that the association’s program protects the management company, or that the management company’s program protects the association. Neither is true by default. One policy does not automatically protect another legal entity.
Who typically purchases each coverage. Explanatory notes follow each row; this is a general pattern, not a determination for any specific association.
Coverage
Community association
Management company
Board members
Unit owner
Master property
✓
—
—
—
The association’s program insures the common elements, and for stacked units the units themselves. Improvements and betterments installed by an owner are expressly outside the statutory requirement.
General liability
✓
✓ own operations
—
—
Both carry it, and they are not the same policy. The association’s responds to the common elements. The management company’s responds to its own operations.
Directors and officers
✓
—
✓ insured under the association’s program
—
Board members are generally protected through the association’s D&O program — not through the management company’s E&O policy.
Property management E&O
—
✓
—
—
Professional liability for the management company’s own acts. The association does not buy it and is not automatically insured by it.
Crime and fidelity
✓
Sometimes
—
—
Association fidelity protection and the management company’s employee dishonesty coverage are different policies protecting different parties. Association requirements usually sit in the declaration.
Cyber liability
Often
Often
—
—
Each entity holds its own data and its own payment flows. Neither policy extends to the other by default.
Workers’ compensation
—
✓
—
—
Follows the employer. An association with no employees generally has no exposure; the management company does.
Employment practices
—
✓
—
—
Follows the employer. In Texas the sexual harassment provisions reach employers with one or more employees.
Unit owner policy
—
—
—
✓
Covers the owner’s personal property, improvements and betterments, liability and loss assessment exposure. Nothing in the association’s program replaces it.
Where contract language changes the answer. A management agreement can require the management company to be named as an additional insured on the association’s policy, or the reverse. It can require indemnification, a waiver of subrogation, or primary and noncontributory wording. Those provisions change who responds first and who is protected — but only if the corresponding endorsement actually exists. A certificate of insurance does not create coverage, a management agreement does not replace insurance, and contract language does not override policy wording.
When to read the documents. Review the declaration whenever the question is what the association must carry or who is responsible for a component of the building. Review the management agreement whenever the question is what the management company owes the association, or what either party must name the other as. Interpretation of either document is legal work and belongs to counsel.
Chapter 82 governs condominiums declared on or after 1 January 1994. Older regimes fall under Chapter 81, whose insurance provision is permissive rather than mandatory. But Section 82.002(c) expressly extends Section 82.111 to pre-1994 condominiums — subject to a limitation: it applies only to events and circumstances occurring on or after that date, and does not invalidate existing declaration provisions.
Where the master policy stops
For a building with horizontal boundaries — stacked units — Section 82.111(b) requires the association’s property insurance to include the units, but expressly states it need not include improvements and betterments installed by unit owners. That sentence decides a large share of unit-owner disputes after a loss, and it is why the unit owner’s own policy is not optional.
Statute is a floor, not the requirement
Texas permits 80 percent of replacement cost or actual cash value. Secondary-market lender requirements are materially stricter. An association can satisfy the statute and still fail the requirements that govern whether units in the project can be financed. Whether any specific association is affected depends on its policy, declaration and lender.
Governing documents are not interchangeable
No declaration is representative of all declarations. This ecosystem explains the statutory framework and the questions to ask. It does not interpret any association’s declaration, bylaws or covenants — that is legal work, and it belongs to the association’s counsel.
The five questions this cluster answers
HOA insurance
What Texas law does not require of a subdivision association, and what the declaration requires instead.
Bring the declaration, the policy and the management agreement
Most association coverage questions cannot be answered from the policy alone. We read the declaration’s insurance article and the management agreement alongside the master policy, and report where they disagree. Legal interpretation is referred to counsel.
Statement of values and valuation, reviewed before renewal.
Written and reviewed by Deon R. Williams, MLS, REBC, CLCS, AIC, AINS — Founder & Principal BrokerLast updated September 12, 2026
Educational content prepared from policy forms, carrier materials and Texas regulatory sources. It is not a binder, a policy interpretation, or a guarantee of coverage. How we research and review this
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