Insurance Coverage

Started by MaryB3 • 4 replies • 1397 views

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MaryB3 (Maryland)
Posts: 21

Posted:

I have been attempting to get our condo board (I am on it) to review our insurance for the past two years. Not only is my request ignored but it took me over a year just to find out what the coverage limits are.

We are located in Montgomery Co. MD. Our association consists of 242 townhomes with the average conservatively estimated at $340K with the land. What percentage of the full value do you think we should carry? We have about 30 percent (including the land value).

Your input is appreciated.

GlenL (Ohio)
Posts: 5,491

Posted:

Mary you should have replacement value for all property the Association is responsible for. Say the things that the association is responsible to replace is valued at $1,000,000.00 today and you buy a policy for $1,000,000.00 in six months the same things could cost $1,500,000.00. The insurance policy would pay the $1,000,000.00 and the Association would be on the hook for the balance.

You can and should shop for a different insurance company periodically. Last time we did, we saved almost $8,000.00 a year with more protection. Always make sure you deal with a reputable insurance agent and verify any company you sign with actually exists. Unfortunately there are a lot of scams out there and you don’t want to pay premiums for ten years and need to use the policy only to find out the company you’ve been paying all that time only exists on paper.

Studies show that 5 out of 4 people have problems with fractions

BrianB (California)
Posts: 2,820

Posted:

i was once told, insure the buildings, never the land. You can't burn land.

So, the previous advice is perfect... how much do you have in buildings? In lossable assets? Those need to be insured, fully. You don't insure land, because it will always be there, even when the buildings are burnt down.

MaryB3 (Maryland)
Posts: 21

Posted:

Estimating that the townhouses are 75 percent of the value - $60 million.

JoeS4 (Kentucky)
Posts: 77

Posted:

You should be concerned with whatever the H.O.A. ownes and liability along with directors coverage. These are all different factors of your policy, finding a good insurance agent with a history of H.O.A. policies is a good start, or just ask serveral other H.O.A. whom they have insurance with?

Our company that we have coverage with, also lets us mail out a letter to all homeowners that offers a discount to individuals. We never know if anyone uses the discount, but its a nice offer since they already have all the major buildings and liability insured.

Good Luck

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