Community Associations Insurance Mistakes

bigstock-Townhouse-at-Dusk-47197144Insurance for community associations is one area that should always be taken seriously. Community Association insurance can protect the owner, board, and employees from costly claims and expenses.

Here are mistakes community associations can make in their insurance program

Not Having Enough Insurance.Your community association should have an umbrella policy with at least a million dollar limit. Recently, a small child drowned in an association pool. The association was sued and lost a three million dollar settlement. An umbrella policy will protect your association from these kinds of events.

You Have Not Considered Fidelity Insurance. Community association trust managers handle the day to day association operations, including the collection of rents and payment of bills.  A local community association hired a manager to handle all their financial and accounting tasks. This manager embezzled over $350,000 over a period of 15 months. Without the proper fidelity insurance, this community association would have had a serious out of pocket expense.

Do You Have The Right Kind Of Property Insurance? If your community association is located near a flood zone, you should carry flood insurance. Do you have loss of rents coverage? Loss of rents insurance will reimburse your association in the event that a covered loss causes an interruption of rental income.

Directors and Officers Liability Is Often Overlooked. Directors and officers insurance covers costs, damages, and defense protection to directors and officers of a company resulting from law suits and judgments arising out of poor management decisions, and tenant issues.

Have You Considered Tenant discrimination insurance? Tenant discrimination is a major issue for community associations, and an exposure not generally covered by general liability policies. Tenant discrimination insurance provides coverage for property managers when current, prospective, or former tenants allege wrongful discrimination.

We have specialized in meeting the unique insurance needs of community associations and property managers for many years. We have assembled a team experienced in the real estate business to better serve landlords, developers, and property management firms.

November 12th, 2015 by Partners Risk Services