HOA Liability Insurance

Started by AudraL • 6 replies • 247 views

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AudraL (Delaware)
Posts: 12

Posted:

Hello! Just looking for any insight or advice. We have just had elected our first HOA Board after the builder has managed it for 15 years. I was elected president two days ago and as we're waiting for our next meeting to decide on legal representation, thought I would try to be proactive and look in to liability insurance for HOA communities. Does anyone have any experience or recommendations as to companies that provide this protection? I'm having a hard time in getting results from online searches, for some reason. we are located in Delaware. thanks so much in advance!

CathyA3 (Ohio)
Posts: 6,299

Posted:

Your association should already have liability insurance from the time when the developer was still in control. Insurance isn't "nice to have", this is "you're gonna bankrupt you if you don't have it."

Look in your declaration/CC&Rs. There should be a section that spells out what kinds of insurance you're required to carry. Usually this will involve property loss/casualty, liability, fidelity (employee dishonesty), and directors & officers. Workers comp or similar insurance is often optional, but you'll need it if you use volunteers. Depending on what part of the country you're in, you may also need extended coverage for things such as wildfires, floods, or earthquakes.

Insurance is often a major expense for an association.

CathyA3 (Ohio)
Posts: 6,299

Posted:

Oh, and it's against the posting rules of this website to mention specific companies. I suggest starting with the builder/developer and see what he says. There should be insurance certificates and other paperwork in the piles that he left for you. You should also talk to insurance agents in your area - we never dealt with the insurance companies directly, only though our agent who was very helpful in answering questions.

JohnC46 (South Carolina)
Posts: 14,265

Posted:

Audra

Are you self managed or will you be hiring a Management Company? Describe your association. Size, style of units, amenities, location, etc.

LoriM15 (Florida)
Posts: 1,009

Posted:

You not only need liability insurance, you need to directors and officers insurance (D&O). If you don't have that you should resign from the board immediately because you could be held personally responsible if the association gets sued. But most big corporations have it.

Our insurance of various kinds is distributed among various companies. What you need to do is first find out what coverage you have now and second call a commercial insurance broker and get them to handle the insurance for you. You don't want to waste your time doing it yourself. They are experts and can find the right policy for the right amount.

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