Navigating HOA Building Insurance when Renting Out my Condo

[David Kim]

Hi folks!

I own a condo in a small, four-unit building, but I've since moved out, and want to rent out the current condo after doing some remodeling.

One of the 4 units has been a rental unit for a while, and mine would be the second such unit. Apparently, if two units do it, and the building becomes 50% rental, that changes something that massively affects the overall cost of insuring the building. Its status becomes "majority renter occupied building" or something of the sort. The HOA (which is self-managed; no third-parties involved) is understandably apprehensive about this.

Anyway, I want to be able to rent whenever I want, but I DON'T want to try to fight for preemptively getting the more expensive insurance for the whole HOA for something that may or may not happen this year. I guess if it's just a couple hundred dollars extra, I can just pay that difference and get on with life.

Is there an easy way to get past the insurance hurdle?

• I would think we could maintain our existing insurance/status, and if I want to rent it out, I'd be purchasing some "bad renter protection insurance" or something like that, which would close the gap. Does such a thing exist? Like, it would be good to just have the "option" of add-on insurance to the existing policy, so the owners of rental units can pay the gap when needed.
• If I use my condo as an Airbnb, rather than a fully-leased rental, is it still subject to those rules? That's another possible workaround, though might not be worth the trouble (have to get it cleaned between each use, etc.) If it lets me do Airbnb, and if Airbnb lets me say "you're required to sign on for 6 months or more" that would be fun and sneaky haha.

Anyway, I appreciate any advice from people in the know. I thought I'd ask here from folks who know this landscape before calling up the insurance company/rental management companies to get their takes on it. Good to know what options are rather than going in blind.

Thanks!