HOA INSURANCE MASTER POLICY

Well, first of all you need to verify what the policy covers - read your CCRs, which should indicate what the association's responsible for and that will dictate what the liability coverage will cover. You also need to remember the association needs other coverage like Directors and Officers insurance, which may or may not be cheap.

Have a pow wow with your agent, who should be willing (and able) to explain your coverage in everyday English. Money's always an issue, so you should discuss what you can do to reduce the association's risk - and feel free to shop around with other companies Once you have all that ironed out, you can tell your homeowners what they'll need to discuss with their own insurance agents.

I also live in a townhouse community and we're getting ready to publish a newsletter article on this subject. Basically, our master policy covers the structure of the unit, but the homeowner's responsible for everything from the drywall in, as well as electrical and water/sewer lines from the point they enter the unit. They would also be responsible for the Association's deductible if damage originated from the unit and spread to an adjoining unit.