Mandatory Insurance?????

Hypothetically, your home burns to the ground and you carry no insurance. You decide to walk away. The vacant lot with the charred remains of your home detracts from the value of the nearby homes. The HOA has a legitimate interest in having your home insured. I am surprised that the HOA governing docs don't require that you name the HOA as an additional insured.

DavidF4: Your quote from the documents does require each unit owner to have appropriate insurance on his unit as well as liability insurance. This does NOT differentiate between whether you have your unit financed through a bank or you own it outright. All are required.

If you do have homeowners insurance, explain to them what your Association is requiring of you. They will be able to assist. Further, what is the process the Board/Association is using to ensure and follow-up with ALL unit owners that they are complying with the requirement?

We personally do have coverage on our personal effects within the unit, on the unit and liability against another getting hurt, also against the Association levying an assessment for having to go to court. If you value your investment, as you obviously do since you own it outright, it is wise to insure it and it is not that expensive.

I appreciate all your replies, however, I think I may not have expressed the point I challenge.

The document does not state "appropriate" insurance. It just states "to maintain insurance" Why can't one be self insured?

I have received a lawyer's letter demanding my compliance.

I was never asked to submit insurance papers. The letter was sent because someone heard me challenge the insurance issue.
No one else in the community has been asked to show their insurance. I have been singled out due to other issues in this community.

self insured means that I assume the risks. When one pays insurance premiums, the company invests that money to obtain profits to pay off claims and pay the expenses of doing business.
In my case, I set aside money and invest it and assume the risks. As far as the scenario with the house burning down and walking away, The insurance proceeds are paid to the insured parties. There is no other assurance that the property will be fixed. The documents provide that each homeowner must maintain his property and the association has the powers to fine for non compliance and foreclose if necessary.

My main beef with the entire situation is that I have been singled out and I shall show my insurance documents when everyone else must comply.

David,

Even if you had mulitmillions ready to pay for and rebuild your home in the event of a catastrophic event, you still need to show proof of Liability to cover the other members of the association who might get injured or worse, within the boundry of your property. That is the law within your own documents.

All documents within an association have some requirements for at least liability insurance. I have to agree with all of the others, you are not in compliance with your docs. As for the others not having to show proof, it is assumend that everyone who has a mortgage or liens will definitely have coverage as that is Federally required. Maybe if this is such an issue, you should write a letter to your Board and tell them that you want everyone to show proof of insurance. The Board just might listen to you and ask for the proofs.

DonnaS et al

I agree that insurance can and could be a wise investment.

Most states, but not all, require auto insurance coverage.

My point is that the way the section is written, it does state the requirements for this insurance. The documents covering the common properties state the minimum limits on liability insurance and quote "replacement value" on the common properties. The country club where I belong states that one must have $100,000 liability insurance and $25,000 property insurance to use your private golf cart on common grounds. I don't argue that point. It states the amounts needed and that proof of that coverage be on file.

Just a point to ponder. Who insures the insurance company buildings??

David:

I believe that you feel singled out perhaps because you do not have a mortgage; therefore your insurance mandate by the mortgage is not there. Thus the board wanting proof of insurance.

The others you spoke to all possibly have a mortgage and you are one of the few that are fortunate enough as to not have one.

We manage units on the beach here in NC and some owners do not have a mortgage and have to show proof of homeowners insurance covering what the HOA's insurance leaves off. The HOA pays flood as a group and all owners are required to pay.

I would suggest you contacting your insurance agent to look at the governing documents to purchase the right insurance for this particular HOA.

David:

Be one of those people that just do the right thing! If we could all get past the blame game and just take care of ourselves, over world would be so much better.

“Good people do not need laws to tell them to act responsibly, while bad
people will find a way around the laws” - Plato 427-347 BD

It is only insurance that will in the end protect your investment. Be community minded; think outside the box and see the big picture.

DavidF4: Is there actually more to this story than what is being presented? You have quoted your documents require each owner to carry liability and personal coverage on their unit, but a process for fulfilling this directive is not stated. Neither, in the PAST as a Board member, are you aware of the Board requiring proof of the coverage.

However, this is 2008. The fact that perhaps this dictate was never acted on "before" does not negate the official and legal requirement of each owner to carry the insurance. You have recd notice from a lawyer for you to show proof of your insurance coverage which you do not have.

There certainly could be more going on here than you are aware of. The fact that now a lawyer is involved implies there may be legal justification for the Board to act on the documents' requirements and they are doing that. It is not something to treat lightly. There appears to be more to the story, peppered with a bit of stubborness.

Have you replied to the lawyer and asked how the Board is fulfilling the insurance coverage directive?