Does Condo Insurance Cover Water Leaks or Building Damage?

Water damage is one of the most common and confusing insurance situations in a condo setting. Pipes burst, appliances fail, and leaks from upstairs units can quickly become expensive. Add to that the question of who covers structural damage—your personal policy or the building’s—and it’s easy to feel overwhelmed.

This becomes especially important when you’re faced with a sudden leak or see water marks spreading across your ceiling. You might think about this the next time your dishwasher backs up or your neighbour has a plumbing issue.

What Your Condo Insurance Typically Covers

Your personal condo policy is designed to protect your space—not the whole building. It usually includes:

Water damage to personal belongings
If your electronics, clothing, or furniture are damaged by water from a burst pipe or appliance inside your unit, your policy may pay to repair or replace them.
Repairs to interior surfaces
Your coverage may also help fix floors, drywall, cabinetry, and other interior features—especially if they are part of an upgrade not covered by the building’s insurance.
Liability for damage to other units
If a leak originating in your unit damages a neighbouring unit, your liability protection can help cover the cost of repairs or lawsuits.

Tip: Your policy may not cover the source of the water damage itself (like a broken dishwasher) but can still cover what was damaged by the water.

What the Condo Corporation’s Policy Covers

The building’s master policy covers damage to structural parts of the building and shared systems. This can include:

Pipes and plumbing outside your unit walls
Ceilings, subfloors, and building framework
Common areas affected by water, like hallways or lobbies

However, the building’s deductible can be very high—sometimes $25,000 or more—and in some cases, that cost may be passed on to individual owners through a loss assessment.

Damage Type	Covered by Your Policy	Covered by Condo Corporation
Water-damaged furniture or electronics	Yes	No
Burst pipe behind walls	No	Yes
Water-damaged flooring upgrades	Yes	No (if considered personal upgrade)
Ceiling damage in hallway	No	Yes
Shared plumbing repairs	No	Yes

Note: Coverage often depends on whether the damage was sudden and accidental (usually covered) or gradual and due to wear or maintenance issues (usually not covered).

When Building Damage Affects You

If a building-wide issue causes damage inside your unit—such as a roof leak or a shared pipe bursting—your insurer may still help cover your personal losses. But the structural repairs themselves will likely fall to the condo board’s insurance. In rare cases, your own policy’s “loss assessment” clause can help cover your share of the condo’s deductible if the damage was significant.

Caution: If you delay reporting a leak, or if it was caused by neglect (like failing to replace old hoses or ignoring known issues), your claim could be reduced or denied.

Water Damage Is Covered, But With Limits

Condo insurance does cover many water-related issues, but the details matter. The source of the leak, where the damage occurred, and how quickly it was addressed can all affect your claim. Understanding how your policy works alongside your building’s helps ensure that when water damage strikes, you know exactly where to turn—and what to expect.