Master HOA insurance - State Farm vs Farmers?

Started by JdW • 7 replies • 340 views

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JdW (Texas)
Posts: 40

Posted:

Our HOA is reviewing our insurance and both these companies are quite large on the national market, serving many states. We currently have Farmers and are happy except for the rate increases. I've heard somewhat less flattering comments on State Farm, but we're still waiting on a quote.

There are a lot of lesser known companies an independent agent for us is also checking into.

Do forum participants have any recommendations for or against particular companies- either experience or word-of-mouth?

TimB4 (Tennessee)
Posts: 21,059

Posted:

JD,

The posting rules (see them by clicking on the smiley face) do not allow mentioning of company names. I expect it's to keep discussions like your seeking from being a possible liability.

I will say that we use a different company (well known but not one of the two you mentioned).

The main thing you should look for in a policy would be the coverage.
Additionally, when looking at the liability or D&O policies, you should see if the policy is inclusive or exclusive of legal fees.

Inclusive means the cost of any legal defense the insurance pays for lowers your available coverage amount if you lost. Example: $1 million policy, legal costs were $500K and the HOA lost. Court orders a judgement for $750K. Insurance would pay $500K ($1 million less legal costs) and the HOA would have to pay the rest ($250K)

Exclusive means the cost of any legal defense the insurance pays for does not affect your coverage limit. Hence, in the example above the policy would pay for the legal defense and the $750K judgement. Of course, expect this policy to be more expensive.

MelissaP1 (Alabama)
Posts: 13,836

Posted:

It really depends on what your insuring. What are your insurance needs/wants? With HOA's many insurance companies do "Bundle" policies. You basically get overage for a variety of things your HOA needs but also what it does not. Like ours covered a HOA vehicle. We did not own a HOA vehicle and never would. However, that coverage had to be in the group policy. Will say that that portion of the insurance did cover IF a board member had an accident doing HOA work, it did cover your vehicle. Just realize our deductible was around 20K sooo...

Look at what your HOA really needs. Will your HOA be able to make up any differences the insurance doesn't cover. Can it cover the deductible? What about replacement costs? Lawsuits? Board liabiity protections.

Former HOA President

JdW (Texas)
Posts: 40

Posted:

Thanks Tim, I was unaware of the rules on not mentioning company names. MODs may want to delete as I don't think I'd get the feedback sought here.

MichaelS56 (Minnesota)
Posts: 858

Posted:

Well said Tim.

MichaelS56 (Minnesota)
Posts: 858

Posted:

Large insurance rates are going up all over the country. Florida has a number of insurance companies going bankrupt or leaving the state. In Minnesota our rates are going up because of the new normal with hail. Our rates went up about $25,000 in one year.

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