Building Ordinance and law A, B and C

I was just informed that Minnesota insurance companies have informed HOA's and Condos that Fannie Mae is requiring a riser policy to our Association Master insurance policy at an additional cost of $8900.00 As I looked online about this law, I see that it is broken down into three parts"

A: Coverage for the undamaged portion of the building.

B: Cost to demolish the undamaged portion of the building.

C: Increased cost of construction to meet current building codes.

I do not know if this is a national issue or just Minnesota.

Thoughts.

To add to what Dean said:

As you may have guessed, underfunded HOAs refers to communities who do things like:

* Not have a reserve fund at all

* Haven't had a reserve study done - ever. Or it's been over 5 years since the last one was done

* Aren't making deposits according to the reserve study recommendations

* Use the fund to cover shortfalls in the operating budget because homeowners will lose their shut if anyone suggests increasing assessments for any reason (like inflation)

* Defer maintenance (because you'll be DEAD by the time the roads need repaving, so why pay for something you'll never use?)

Etc., etc., etc.

Hopefully, your board is reviewing these requirements with your master insurance company to see where you stand. You should also be checking your reserve fund to ensure you're using updated information to prepare the budget.