Running a condo association involves a number of tasks, like ensuring that homeowners adhere to the rules and regulations, that the common spaces are cleaned regularly, and most importantly, that the condo building and its related association have the right types and amounts of insurance. Your group should already have the required policies, like building insurance and liability, in place, but are the coverage amounts large enough to meet your needs? As real estate prices continue to rise, you want to make sure that your insurance allotments do as well so that you can update them as needed.
So, when do you know it’s time to review and possibly update your condo association’s insurance policies? Let’s take a look.
Reviewing Your Insurance Policies
Twice a year when your property tax bills are sent out, your condo association’s treasurer pays them. They often do this without even thinking about it, as it’s part of your HOA guidelines and regulations. However, this is the perfect time to go over your insurance policies. Twice a year, your condo association members should agree to meet and review whether or not the building as a whole has enough insurance and in the proper amounts. Here are a few things to look for throughout the process:
The Valuation of Your Property
The amounts that your condo association is insured for needs to reflect how much the property is worth. In today’s hot real estate market, this amount more than likely changes on a twice-a-year basis, going up each time. What does this mean? It’s possible that your property might not be currently insured for as much as it’s worth, leaving it, and by extension, the condo board and residents, exposed to having to pay some out of pocket should something happen to the building.
Costs of Repairs and Replacements
In addition to the cost of property rising, so are the prices for building repairs and items replacements, like windows and doors. Inflation has increased the cost of raw materials, and along with it, the price for labor and related services. As a result, your insurance policies need to reflect these projected prices and should have maximums that are enough to cover the full cost of them.
Which Policies Do You Have?
On top of going over how much insurance your condo association has, you also need to make sure that you have the proper policies in general. Some of the ones that you need to have (or should consider having) are:
Building Insurance – The general building insurance on your condo covers things like repairs to the structure after it’s been hit with storm or fire damage.
Liability Insurance – These policies pay for things that your condo association may be found liable for.
Umbrella Liability Insurance – An umbrella policy provides coverage over the maximum of your standard liability insurance.
Specialty Insurance – Depending on where your property is located, you may have to carry flood or windstorm insurance.
Have Questions? Contact Charlotte Insurance
Want to learn more about insurance policies for your condo association and related buildings? Contact Charlotte Insurance. Our agents can explore and explain all available options and put together the insurance coverage plan your building needs.