Levels of Condominium Association Responsibility
There are three levels of condominium association’s responsibility;
1) Start early. At least 90 days prior to your current policy’s expiration. It takes time for agents and brokers to shop for these policies and match your requirements.
2) Contact an experienced independent agent that is knowledgeable in condominium association insurance. Independent insurance agents have access to multiple brokers and companies, and they can submit your quote request to multiple markets.
3) Request a copy of your “Loss Runs” from your condominium association’s current insurance company. “Loss Runs” are a hard copy report from your current insurance company that details any losses you have had with this insurance company. All insurance companies will require this before they will provide your association with a competitive proposal. (Even if you have not filed any claims). Here is a “Request for Loss Runs (Fillable)” for you to complete and send to their current insurance company.
4) Gather the following information related to your association. All insurance companies will require this information.
a. Current 5 years of loss runs from your current insurance company
“Request for Loss Runs (Fillable)”
b. A copy of your current budget and balance sheet including reserves
c. Association documents (By-Laws/Covenants)
d. Declaration pages for your current policies or a certificate of insurance showing your current limits and deductibles
e. Building Improvements (major repair or replacement) of each of the following;
Roofing Year _____ Electrical Year _____ Plumbing Year_____ HVAC Year _____
f. A statement as to how many rentals there are
g. Board President Name ______________ Phone# _________ Email______________
h. FEIN (Federal Employer Identification Number)
i. Questionnaires (only as necessary)
a. “Condominium Association Basic Questionnaire (Fillable)”
b. “High Rise Questionnaire (Fillable)”
c. Special Amenity Questionnaires
1) Flood – No package insurance policies cover flood. Flood insurance is always separate.
2) Earthquake – This isn’t always included in package insurance policies. Earthquake coverage can either be added to some package policies or written as a separate policy.
3) Ordinance or Law Coverage (Increased Cost of Construction) – This isn’t always automatically included in package policies. However, it can usually be added.
4) Boiler & Machinery (Equipment Breakdown) – This isn’t always automatically included in package policies. However, it can usually be added.
5) Automobile Coverage – This isn’t always included in package insurance policies. However, hired and non-owned auto coverage can be added to some package policies. Owned auto coverage always requires a separate policy.
6) Directors and Officers – This isn’t always included in package insurance policies. It can be added to some package policies, however the coverage offered for Directors and Officers on some package policies can be inferior to stand alone Directors and Officers policies.
7) Fidelity Bond/Employee Dishonesty Coverage – This isn’t always included in package insurance policies. It can be added to some package policies, however the coverage offered for Employee Dishonesty on some package policies can be inferior to stand alone Employee Dishonesty policies.
8) Workers Compensation – No package insurance policies cover workers compensation. Workers compensation insurance is always separate.
9) Sports Team Coverage – Most association general liability policies exclude coverage for “Athletic Sports Participant” injuries.
1) Shop – The best way to save money on your condominium association insurance is to shop around. Lewis Association Insurance offers policies from the leading financially stable insurers that offer broad coverage with competitive pricing. We know this marketplace extremely well and understand the underwriting appetites, coverage offerings and pricing tendencies of insurers specializing in condominium association coverage. We excel at matching associations with the insurers that are best suited to protect their association.
2) Deductible – Increasing your association’s deductible will reduce your premium. However, you should consider a few factors when doing so;
a) Is the reduction in premium worth carrying a higher deductible?
b) How much deductible can your association comfortably afford to pay for each claim?
c) Current Georgia State Law – Georgia Condominium Act (Insurance Required Section) section 44-3-107 limits the amount of deductible that condominium associations can pass on to an individual unit owner to a maximum of $5,000 for state required coverages (last updated 8/20/13).
3) Be thoughtful when submitting claims – It isn’t always in your association’s best interest to submit every little claim. Insurance company underwriters consider two main factors related to claims;
a) Severity – If your association has a very large claim this will have an adverse effect on the future companies and rates that are available to your association. Unfortunately, this is not something your association can control.
b) Frequency – This is how many claims your association has. By not submitting every small claim your association can reduce your claim “frequency” and this will in the long run help mitigate unwanted rate increases.
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