Community Association, Condo, Co-op, and HOA Insurance Solutions 

Since it is the board’s fiduciary obligation to protect the financial position of the building, establishing an adequate amount of insurance is a significant concern. To check if your policy limit is sufficient, the board can engage a reputable, independent, certified insurance appraiser to determine the replacement cost of your building(s). Brown & Brown can provide a list of appraisers in your geographic area. You want the appraiser’s opinion to be backed by their professional liability (errors and omissions) policy.

The board of an association can face allegations of breach of contract, breach of fiduciary duty, discrimination, or other wrongful acts. A D&O liability policy helps protect the directors, officers, employees, committee members, association and property manager against these types of exposures. 

The association's master policy typically covers the common areas, shared property, and the building's structure. A personal homeowner's policy, often called an HO-6 policy for condo owners, covers a unit owner’s personal belongings, the interior of the unit, and liability for incidents within the unit. Think of it as the association insuring the "outside-in" and the unit owner insuring the "inside-out.”

Common claims often involve water damage from pipes, wind or hail damage to roofs, and slip-and-fall accidents in common areas. You can help prevent these by performing regular maintenance on plumbing and roofs, keeping walkways clear, and addressing hazards promptly.

Brown & Brown’s community association specialists review your governing documents and compare them against state statutes and your current policies. This annual audit helps confirm your coverage meets legal and internal requirements. 

As a board member, your fiduciary duty means you must act in good faith and in the best interests of the association, which includes purchasing appropriate insurance coverage. This responsibility requires you to make prudent decisions to protect the association's assets and finances from predictable risks. 

You can help control insurance costs through preventive maintenance and regular property inspections to identify vulnerabilities, along with upgrades to infrastructure (like roofs) and safety systems (e.g., fire alarms, security cameras). Many insurers offer discounts for communities that actively work to reduce their potential for claims.

Managing risk for amenities involves establishing clear rules for use, conducting regular safety inspections, maintaining facilities, and posting visible signage about potential dangers. Proper supervision and adequate fencing for pools are also critical steps to protect residents and limit the association's liability. 

Check your governing documents and local laws to see if short-term rentals are even allowed. If they are, talk with your insurer to understand how these rentals will affect your association’s insurance policies. If you decide to allow this rental activity, establish clear rules and enforcement policies. Require hosts to carry their own liability insurance and amend your documents to reflect the rules and restrictions pertaining to rental activity.

The key is to fund and follow a reserve study, which is a long-term capital budget plan for the repair and replacement of major community assets. Regular professional inspections can identify deterioration early, allowing you to schedule repairs before a catastrophic failure leads to a major insurance claim. 

Technology like water leak detectors and security cameras can provide early warnings to prevent major damage or deter crime. While these systems enhance safety, it's crucial to manage the associated cyber risk by securing your network, protecting your data, and procuring cyber insurance.

It is a wise financial practice to set aside funds for your master policy deductible. This prevents the need for a large special assessment on homeowners after a loss and helps ensure you can begin repairs immediately.

To manage EV charger risks, ensure installation is performed by a qualified electrician according to all codes and that the stations undergo regular maintenance inspections. Also establish clear rules for usage and work with your insurance broker to confirm your liability coverage extends to the charging stations. 

Associations often fall out of compliance due to inadequate reserve funding, deferred maintenance, or having insurance policies that don't meet Fannie Mae's specific requirements. Other issues include having a high percentage of non-owner-occupied units or being involved in significant litigation. 

New construction or major renovations increase the property's value yet introduce new risks. Ask Brown & Brown if you need a builder’s risk policy, since your regular property insurance may exclude coverage for construction. Once your project is complete, you will need to update your property insurance limits to reflect the new value of your building(s). It's also vital to ensure all contractors have their own sufficient liability and workers' compensation insurance.