Massachusetts Condo Insurance: 183A and FAIR Plan Rules

Under Massachusetts law, the organization of unit owners has the power to insure common areas and facilities in its own name. Each unit owner also keeps the right to insure their own unit separately. At The HOA Guide, we review condominium statutes across the country to show boards and owners how their governing rules work in plain terms.

A condo master policy covers shared property, but it does not replace individual coverage. When insurers in the voluntary market refuse to issue a policy, property owners can look to the state residual market. Understanding these separate layers helps communities avoid expensive coverage gaps.

What Massachusetts Law Says the Organization Insures

The Massachusetts condominium statute, M.G.L. c. 183A, s. 10(b)(3), grants the organization of unit owners the power to obtain insurance on the common areas and facilities. That coverage is written in the organization’s own name. The statute gives the organization authority to act for the entire community regarding shared property.

This statutory provision does not list a specific dollar limit or property valuation formula. It does not establish whether a policy must use replacement cost or actual cash value. Boards must read their own master deed and bylaws to identify any mandatory coverage levels or specific peril requirements. Do not guess what those governing documents require. For an overview of how master policies operate across different building structures, consult our guide to the condo master policy and our review of what condo insurance covers.

Why Every Unit Owner Still Needs Their Own Policy

A condo master policy does not protect an owner’s personal property or individual liability. Under c. 183A, s. 10(b)(3), organization-level coverage is without prejudice to the right of each unit owner to insure his or her own unit for his or her own benefit. That statutory reservation means association insurance never cancels out the need for individual protection.

Unit owners generally secure individual coverage through an HO-6 insurance policy. This separate policy protects interior improvements, personal belongings, and personal liability. It also provides a base for loss assessment coverage, which helps when an association assesses owners for a covered loss that exceeds master policy limits. You can see how these two policies interact in our comparison of master policy vs. homeowners insurance.

Fidelity Insurance for Larger Condominiums

Financial safeguards are mandatory for larger Massachusetts communities under state law. Under c. 183A, s. 10(h), the organization must secure and maintain blanket fidelity insurance at its own cost and expense. This policy must cover the dishonest acts of any person who handles organization funds.

The required coverage amount must equal at least one-fourth of the annual assessments, not counting special assessments. This statutory mandate applies specifically to condominiums of more than 10 units. Smaller associations of 10 units or fewer are not held to this specific statutory threshold under s. 10(h), though their own bylaws may still require financial protections.

The Massachusetts FAIR Plan for Declined Risks

Property owners unable to secure basic coverage in the private sector have a statutory safety net. The Massachusetts Property Insurance Underwriting Association (MPIUA), widely known as the Massachusetts FAIR Plan, was formed under chapter 731 of the Acts of 1968. Its purpose is to provide basic property insurance to eligible applicants who cannot obtain coverage from insurers in the voluntary market.

MPIUA functions as a residual market insurance association. Every company licensed to write basic property insurance in the Commonwealth of Massachusetts is required to participate in it. MPIUA operates much like a standard insurer: it inspects and underwrites risks, accepts premium payments, issues insurance policies, and adjusts claims. Like the residual market framework examined in our New Jersey condo insurance guide, it guarantees access to basic property coverage when private carriers decline an application.

Standard Market vs. Residual Market Differences

Condominium boards and owners shopping for property coverage will encounter two distinct markets in Massachusetts:

Feature	Voluntary Standard Market	Massachusetts FAIR Plan (MPIUA)
Market Type	Private commercial carriers	State residual market association
Carrier Participation	Optional carrier risk appetite	Mandatory for all basic property insurers in MA
Eligibility	Underwriting approval by individual carrier	Eligible applicants unable to obtain voluntary coverage
Governing Authority	Private underwriting guidelines	Chapter 731 of the Acts of 1968
Operations	Carrier underwrites, bills, and adjusts	MPIUA underwrites, collects premium, and adjusts

Standard carriers write policies voluntarily based on their individual underwriting criteria. MPIUA exists solely to provide basic property insurance when those voluntary carriers turn an applicant away. If your building faces non-renewal, review national options in our guide to the best condo insurance companies or explore our main insurance and reserves hub before turning to residual options.

Who This Guidance Does Not Fit

This general statutory guidance does not fit every ownership structure. Condominiums of 10 units or fewer do not face the statutory fidelity insurance threshold set forth in M.G.L. c. 183A, s. 10(h). If your master deed or bylaws establish stricter insurance requirements than state statute, your board must follow those stricter recorded terms rather than baseline statutory minimums.

What Would Change This Guidance

Two clear actions would alter this analysis. First, if the Massachusetts Legislature amends M.G.L. c. 183A, s. 10 to establish mandatory property valuation standards, alter fidelity minimums, or expand coverage mandates, association obligations would change immediately. Second, if MPIUA adjusts its eligibility criteria or alters the basic property insurance products it makes available under its governing framework, options for declined properties would shift.

Next Steps for Massachusetts Boards

Review your condominium declaration and master deed to identify any property coverage mandates that exceed basic state law. Confirm that your management team or treasurer maintains the fidelity bond required for communities with more than 10 units. This is educational information, not insurance or legal advice. A board should confirm its coverage against M.G.L. c. 183A, s. 10 and its master deed and bylaws with a licensed Massachusetts insurance broker experienced in condo master policies, and consult a Massachusetts community-association attorney for its specific situation.