Condo Board

Living in a condominium or planned unit development is all about sharing. The insurance expense is one of the common items shared by all unit owners. What does insurance for the association cover?

The insurance typically includes four coverage parts, some of which will be more important to you than others. Here is the rundown on these coverages and how they can affect you and your family.

Property Insurance

If you live in South Florida, this is very important coverage. It provides coverage to the structure for windstorm (hurricane), fire, water damage, theft and other specific perils. However, you are responsible to secure the coverage for your contents, and the interior of your unit if you are a condominium unit owner.

How does this affect you? If the association is not properly insured, it can assess the unit owners to pay for the repairs.

Liability Insurance

This is also a major part of the association insurance program. It provides insurance coverage for accidents or injuries that occur on common property. For example, if a slip and fall accident occurs, it would provide coverage for the defense and any award up to the policy limit.

No coverage or not enough coverage could also result in an assessment to the unit owners.

Directors & Officers Insurance

This coverage protects the association’s directors and officers, and some others depending on the policy definitions, from lawsuits they may face while performing their duties. This could include filing complaints or even defending vendor complaints or lawsuits.

This may not seem like it affects you, but a special assessment could result from a lawsuit that gets out of control.

Employee Dishonesty

Fidelity bonding is required by Florida statute for both condominium and homeowner associations. This protection is for theft of association funds. It is protecting your money that has been paid to the association including any reserves, CD’s, etc.

In addition to the above coverages, your association should also consider flood, umbrella, cyber liability, environmental impairment liability and workers compensation.

Remember, it is in your best interest for your community, to remain safe and solvent.

If you have any questions on coverage, be sure to contact Park & Associates.

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