HOA insurance for 28 units

Our HOA has only 28 units, and no pool, elevators,gates,club house really small Court Yard. But I feel we are paying to much maintenance fees, I believe our major expense is our insurance policy, some believe we are over insured? Is there any way to know what the necessary coverage required according to the property value, size and risks.

If you are trying to compare your policy with anyone that lives in a detached home, DON'T. Your policy SHOULD cover what the CCRs require it to cover. Most likely, what you describe is a condo with insurance covering the whole building, plus any common area you may have. It should also have insurance for the director and fidelity insurance against theft.

Being in Florida, you probably have windstorm and flood insurance, which is not cheap after last years insurance losses. Yep you guess guessed, while a big portion was in Texas, you in Florida get to share in the pain.

What kind of insurance? Property (including windstorm)? Liability? Directors & Officers? Flood? Workman's Comp? Your HOA probably has/needs more than one kind of policy.

Premiums vary by area in Florida, too. Where I am we got off relatively easily with Irma last year and Matthew the year before that. Our total premiums this year went down. We switched agents this year and we have more coverage for less money. Which is strange, in a way, because our property insurance carrier was in the news early this year when they hiked rates as much as 15% in South Florida. We're not technically in South Florida so maybe that had something to do with it.

There are industry standards by which a property or properties can be evaluated for the estimated costs of replacement. We have a study done every 3 years. It assigns calculated dollars per square foot of different types of floor space. For us it's garage, living space under air, and patios. I imagine there are other types that may apply. The report supplies not an appraisal but a replacement cost estimate. The firm we use, which I won't name, uses something called "Marshall & Swift Business Valuation Software" which, as I understand it, is some sort of industry standard. We take that report and make sure our insurance coverage every year is at least enough to cover the replacement costs estimated by it.

Make sure to find out whether you need "Ordinance & Law" coverage. That's designed to cover the extra costs imposed by updated building codes and local county construction codes that have been enacted since the place was actually built. That's very important to have.

You can't really shop around for property and casualty insurance in Florida. Your agent can do that. In Florida, once an agent submits your underwriting information to different insurance companies, all other agents are locked out of the process. So you shop around for an agent you're comfortable with and they, in turn, get quotes from different carriers on your behalf.

There are different regulations for condominiums than for HOAs. We are an HOA but, in accordance with our CC&Rs from 1989, the HOA has to cover all 80 buildings in the subdivision with property and casualty insurance, including the residences. Because of the way we're set up, insurers will only write us a master condominium-type policy and that's subject to a lot of regulations I'm not all that knowledgable about. I spend enough time on FS 720, I'm not about to dive into Florida insurance regulations, I can only relay what we were told from 4 different agencies over the last year.

First of all, we need to sign an "Agent of Record" letter. No insurance company will even talk to an agent about a property unless that agent is named as the association's Agent of Record. Our AoR gets a quote from one insurance company and they won't talk to any other agent about us.

Two references for you. First, this "Condo Q&A" column that appeared in Florida Today a few years ago. Excerpt:

"It's also important to understand that it is not legal for different agents to offer different prices for the same insurance with the same carrier because the industry is heavily regulated. So, you can't simply shop around to different insurance agents to see who will offer the best price."

And the second reference is this short 5-page PDF written by a guy (no date on it) who is/was a "Florida Condo Association Specialist" who apparently has a business in Panama City, FL. Excerpt:

"THE RULE - ONE AGENT FOR ONE COMPANY – THE FIRST AGENT SUPPLYING THE UNDERWRITING INFO OF YOUR ASSOCIATION TO THE COMPANY BEING THE WINNER"
"What this means is the first insurance agent to supply underwriting information about your association to the insurance company, no matter how basic or thorough the underwriting may be, secures that company on your behalf. No other agent then can even talk to the company about your association’s insurance needs. The first in... wins"

We were told the exact same thing by 4 different agents in 2 different counties. Whether it's something mandated by law, regulations, or an industry-mandated thing, I couldn't tell you. We take our agent's word for it.

This doesn't apply, as far as I know, if you're a typical Florida HOA with typical common property insurance needs. With our need for a condo-type policy, we're not "typical", so your mileage may vary.