Unfollowed CCR provision

First a disclaimer: I'm not an insurance professional.

Your CC&Rs/Declaration should explain what parts of your property are common elements and what parts are privately owned.

Typically the unit owners insure the items they own, and the HOA insures the common elements. When unit owners buy their insurance, the agent usually asks to see a copy of the CC&Rs so that the HOA's master policy and the owner's personal policy work together with no gaps or overlaps in coverage.

Ignoring what the CC&Rs say about insurance coverage is risky business. Legally you can't do so, and you risk having an uninsured casualty or loss if there are gaps in coverage.

What you've described sounds unusually complicated, and I've never heard of an association that allows this kind of flexibility - mostly because the definitions of "unit" and "common elements" are not flexible. Not saying that it can't happen - just that I've never heard of it, and it contradicts what I know about insurance in communities with attached homes.

So... can the HOA change things? Maybe. If you've been doing things wrong for years, you have to correct this before things go expensively wrong. If you've been doing things correctly, then changing would require an amendment to your CC&Rs which is approved by a majority of the membership (and probably a super-majority of 2/3 or 3/4). In both cases, the board and the membership need to understand what they're doing and the consequences of their decisions. So some education is in order. The board should start with the HOA's insurance agent and go from there.

If what Dean says is true, then it sounds like the association is carrying all-included insurance, which does indeed cover certain repairs to units. Individual HO6 policies will account for that, and the premiums charged to the association and to the owners will reflect it.

If there is a claim, the insurance companies typically settle it.

In my experience, if the CC&Rs require all-included insurance, then none of this is negotiable (except maybe the part between the insurance companies that are settling a claim).

Look in your CC&Rs for that information.

There should be a section that deals with insurance, including whether the HOAs has to carry all-included or bare walls insurance. All-included insurance will cover portions of a unit if there is a claim, bare walls insurance only covers common elements. This section should also address whether unit owners have to carry their own insurance or not. If owners choose not to buy their own insurance, they do so at their own risk - the HOA's policy will not step in to cover things that are unit owner responsibility.

All homeowners are asked to carry HO6 insurance. The insurancee for the structure and exterior is carried by the HOA as part of the common eexpense. So, the insurance requirements are met, it's the question of who pays for the structure and exterior coverage for the units. Per the CC&R, that is to be provided by or (if in the HOA policy) paid for by the unit owner. As I said, that cost has always before been common expense.

Providing the google docs link to the covenant on insurance helps enormously; thank you.

I am giving you my layperson's take, based on a lot of reading of covenant law over the years.

For a certain category of covenants involving land use, where the covenant has not been enforced for a long time and other criteria are met, once in awhile courts will rule such a covenant abandoned. But this insurance covenant does not fall into this category. This is because violations of the insurance covenant would not be obvious to someone who was considering buying into the PUD. Instead, potential buyers would read the covenant on insurance and think: 'Okay, one way or another I have to pay for the entirety of my townhome's insurance.'

In my opinion a court would not look kindly on an argument that the Board has been violating this insurance covenant for a long time so the Board //must// continue doing so. Uh uh. If I were the judge, I would point out that the case law is clear that covenants are essentially contractual terms. Everyone knew these terms before purchasing a townhome. Time for each owner to start paying for his/hger townhome's insurance coverage.

Anyone saying this is messy, because maybe the PUD has responsibility for maintenance of the exteriors inter alia: I agree.

As for how to compute what each owner must pay: The courts say the board should strive to be reasonable and fair. I would need a lot more info to say more than this.

What Dean said. We can give you our opinion, but it wont matter what we say because none of us are attorneys and what may or may not be true in your state may be the opposite in ours (and possibly not addressed at all). Since your question concerns insurance you need to dpeakt to an attorney sooner rather than later.

Find the documents you received at closing and bring those with you, as well as a copy of the master insurance policy (the association should give you a copy).

I looked at the CC&R's section on insurance. It allows for flexibility that I have never seen in any other CC&Rs that I have read. I can't even begin to form an opinion on this.