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Subject: Workman's comp insurance
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JimD17
(South Carolina)

Posts:15


01/24/2015 4:57 PM  
Our HOA insurance agent has suggested we purchase a workman's comp policy to cover any one who does work for the HOA who may not have workman's comp coverage. We require all contractors to give the HOA proof of workman's comp insurance before they are hired to do any work. I am wandering if this type of coverage is common for HOA's who have no actual employees.
RuthO


Posts:0


01/24/2015 6:19 PM  
Very common and in California, the annual cost is about $600. Great protection
AllisonD
(Florida)

Posts:447


01/24/2015 6:19 PM  
We got it a few years ago. In a perfect world, you would not need it but its a small price to pay for extra insurance, just in case. Just because a vendor provides their insurance does not mean it cant get cancelled the very next day.
NpS
(Pennsylvania)

Posts:3865


01/24/2015 6:33 PM  
We also have no employees. Our insurance company does insurance audits every year. We must provide contractor name, nature of work done, whether we provide any tools, amount paid to contractor annually, copies of contractor's insurance certificates. If we don't provide all the info for the audit, our insurance rates go up.

Sikubali jukumu. Read all posts at your own risk.
BillH10
(Texas)

Posts:410


01/24/2015 9:30 PM  
We have it in the association in which we live, and recommend it in the associations we manage.

Two reasons:

1. While we require contractors to provide Workers Compensation insurance in both the association in which we live and those we manage, unless the association is an additional named insurance on the policy, there is nothing to stop the contractor from cancelling the insurance the day after we let the contract. Should they do so, the Association may be the "deep pockets" an injured contractor employee may go to in the event of an accident.

2. The policies we have just purchased this year, and which we recommend to our clients, also cover volunteers putting up holiday lighting, committee members setting up for a social event, or whatever. I assisted a group putting up and taking down Christmas decorations. I watched a 69 year old neighbor crawling across the top of a 10' wall to release holiday decorations. All I could see while he was doing that was liability if he fell.

Our coverage is $400.00--$4.00 annually where we live. The cost is insignificant.
BillH10
(Texas)

Posts:410


01/24/2015 9:36 PM  
Sorry, it is late and my last statement was not complete.

Our annual coverage for the association in which we live is about $400.00, which works out to slightly less than $4.00 annually per property owner.

The cost is approximately the same per property owner in the associations which we manage, depending on the common areas/amenities.
TimB4
(Virginia)

Posts:16542


01/25/2015 6:36 AM  
Jim,

We do not have workers comp insurance because we also do not have employees and see no need for it.
We ensure that the contractors we hire have insurance and are licensed.

That said, I really have not done a lot of research into this area.
Since you are in SC, here is the link to the applicable SC laws:

Title 42 - Workers' Compensation

SOUTH CAROLINA WORKERS' COMPENSATION COMMISSION

LarryB13
(Arizona)

Posts:4099


01/25/2015 10:39 AM  
Jim D,

No doubt your insurance agent would like to sell a workman's comp policy. May I suggest obtaining advice from your association's attorney before buying this coverage?

I was advised by an attorney years ago that workman's comp covers injury claims between an employee and his employer. The exact terms will vary somewhat by state; In AZ, for example, an employee who accepts an award under workman's comp is barred from suing anyone else.

Since this coverage is between the employer and employee, I have my doubts that your workman's comp would cover a claim made by an uninsured contractor's employee. Your general liability policy, which you should already have, would be more likely to provide coverage.

You might also want to see if workman's comp covers unpaid volunteers. I used to receive coverage for employees through the state compensation fund but coverage was for a specific person in a specific job category and the premium based upon the amount I paid him. I am not sure how keen they would have been to pay a claim for someone for whom they never collected a premium.

TimB4
(Virginia)

Posts:16542


01/25/2015 10:46 AM  
Thanks Larry.
You explained what I wanted to but couldn't find the words for.

KerryL1
(California)

Posts:6703


01/25/2015 3:42 PM  
I'm with Tim an Larry on this topic.
JerryD5
(Colorado)

Posts:205


01/25/2015 5:38 PM  
I do not believe our HOA carrys workers comp insurance. I assume our MC has it for our PM who does property inspections and I know our landscaper carries it for their workers. What if one of our board members gets injured doing HOA work. While we pay for snow removal, I actually don't mind shoveling the sidewalks in our area. I am home anyways and 75% of the time, I beat the actual snow removal crews. What would happen if I got injured (like a slip and fall incident) while shoveling? I am on the HOA board.
JohnC46
(South Carolina)

Posts:8827


01/25/2015 5:52 PM  
Jerry

Are you employed and/or paid by the BOD to do whatever?

If not, then you are not an employee.
JerryD5
(Colorado)

Posts:205


01/25/2015 6:23 PM  
John, no we are strictly volunteers and our CCRs specifically state we are not allowed to benefit from our positions or be paid.

I know we are not employees. I just assume that if I am injured while I am shoveling, I would just have to use my own medical insurance, etc. I would never sue our HOA for injury. Though we did have an older homeowner (not a board member) sue us for a slip/fall she had in her area of the association. She recovered a 6-figure settlement. Since then, we make sure her sidewalk is always shoveled/ice melt applied.
BillH10
(Texas)

Posts:410


01/25/2015 7:16 PM  
The reason why we added WC insurance in the association in which we live, and why we recommend it, (and our master association recommended it where we live, and our attorney recommended it)is the scenario discussed by Jerry and John: an injury to someone who everyone presumes will be covered by some other aspect of WC.

Texas is a dichotomy: there are very conservative people here, yet we have legislative imposed mandates which stipulate HOA management guidelines the likes of which I have not previously seen; and I was moved here in 1997 from the Bay Area. Some of the recent Texas legislative mandates have not been challenged or tested in court. Until they are, $400 annually is inexpensive insurance against lawsuits, regardless of the merits of who is, or is not, an employee.

I do agree with Larry. Talk with your association attorney before you purchase insurance which may not be needed.



KerryL1
(California)

Posts:6703


01/26/2015 9:19 AM  
I can see where some self-managed HOAs might have directors who climb on ladders, shovel snow, etc.

Our HOA insurance does not cover any of us volunteers, i.e, directors and committee members. When we renew our policy, we are reminded that we must not engage in any such activities (e.g., landscape comm members might want to climb on the rocks by our water feature, etc.)
JohnC46
(South Carolina)

Posts:8827


01/26/2015 1:26 PM  
All

Yes $400.00 might be short money but left up to most insurance agents, they would short money you to death for "additional" coverage.

Well it is only so and so more....how many times have you heard that? It is called an upsell.


RogerB
(Colorado)

Posts:5067


01/27/2015 7:53 AM  
One townhome HOA which we manage does carry Workers Comp which specifically covers independent contractors who do maintenance in the common area. Also, since some contractors hire subcontractors and they may not carry this insurance or it may lapse. Thus they do this to make sure they are covered in case of a serious injury. It is not a significant expense compared to their budget and they want to be safe rather than sorry.
LarryB13
(Arizona)

Posts:4099


01/27/2015 8:57 PM  
Posted By RogerB on 01/27/2015 7:53 AM
One townhome HOA which we manage does carry Workers Comp which specifically covers independent contractors who do maintenance in the common area. Also, since some contractors hire subcontractors and they may not carry this insurance or it may lapse. Thus they do this to make sure they are covered in case of a serious injury. It is not a significant expense compared to their budget and they want to be safe rather than sorry.




The acid test would be to file a claim and receive compensation. I have some serious doubts that the HOA's WC is going to cover a subcontractor's employee's claim.
TimB4
(Virginia)

Posts:16542


01/27/2015 9:13 PM  
Roger,

Is is actual workers comp insurance subject to the States workers comp commmission, or an insurance policy/rider that provides coverage similar to workers comp?
LarryB13
(Arizona)

Posts:4099


01/27/2015 9:45 PM  
I spent more time than I should have today researching Workman's Compensation (WC) in the Arizona statutes.

From what I can see, HOA volunteers are not covered by WC. The only volunteers who are covered are those who serve in positions such as a sheriff's posse, search-and-rescue, or some other first-responder job. There is a provision for covering some volunteers who work for government entities. In each case, the law requires fixing an income level for the covered employee; the income level is as low as $400 for some volunteers and the equivalent of entry-level wages for others.

My own experience is consistent with what I read today; that is, premiums are based on the type or work the employee performs and how much he is paid.

While I found provisions for sole proprietors and partners to be covered by WC, I found nothing in the statutes that would support obtaining coverage for those who are not your employees. The law requires the employer - and not the employer's customers - to provide WC coverage.

This leaves me curious as to just what those who purchased Workman's Compensation policies really bought. I hope someone can provide a link to a pdf of one of these policies.
RogerB
(Colorado)

Posts:5067


01/28/2015 8:42 AM  
Posted By TimB4 on 01/27/2015 9:13 PM
Roger,

Is is actual workers comp insurance subject to the States workers comp commmission, or an insurance policy/rider that provides coverage similar to workers comp?


The situation occured where two handymen were each hired as an independent contractors to maintain the common elements. One of the handymen got on roofs to make repairs and to clean gutters (both of which are commmon elements in this townhome association). After hashing this out amongst Board members a special Board meeting was called with the insurance agent and the HOA attorney in attendance to determine the most effective method, including costs, to resolve this. Ultimately all present decided the best procedure was to list the two independent contractors as insured under the Pinnocol Workers Comp Insurance. Their insurance agent worked this out with Pinnacol, the Workers Comp insurance company in Colorado. Meanwhile, to my knowledge, this has never been tested in Court.

Since then, due to about $4,000 increase in cost of this Workers Comp when they get on a roof, I have convinced the Board to hire a roofing contractor to do all work requiring getting on a roof. The 2 handymen still are covered under Workers Comp for all other common elements work.
JimD17
(South Carolina)

Posts:15


01/28/2015 10:48 AM  
Roger, Who is Pinnocol? Is this the HOA? If so did they already have a workmans comp policy for other employees?
JimD17
(South Carolina)

Posts:15


01/28/2015 10:48 AM  
Roger, Who is Pinnocol? Is this the HOA? If so did they already have a workmans comp policy for other employees?
RogerB
(Colorado)

Posts:5067


01/28/2015 4:05 PM  
Posted By JimD17 on 01/28/2015 10:48 AM
Roger, Who is Pinnocol? Is this the HOA? If so did they already have a workmans comp policy for other employees?


As I stated "Pinnacol, the Workers Comp insurance company in Colorado".
RobertL20
(Virginia)

Posts:3


01/29/2015 2:26 PM  
I suggest you check into that. I am in VA as well and went through checking this out with the folks in Richmond.
Even though we are self-managed with no employees and volunteer board members we are still required to have it if we hire a contractor who has more than one employee. We fill out a form to exclude our officers from coverage and that saves us some money.Costis around $600/year for us.

If you ask me it is a tax, but my delegate did not seem interested in doing anything about it. Once again it's government here to help us!
KellyM3
(North Carolina)

Posts:1429


01/31/2015 7:23 AM  
Posted By JimD17 on 01/24/2015 4:57 PM
Our HOA insurance agent has suggested we purchase a workman's comp policy to cover any one who does work for the HOA who may not have workman's comp coverage. We require all contractors to give the HOA proof of workman's comp insurance before they are hired to do any work. I am wandering if this type of coverage is common for HOA's who have no actual employees.




Jim,

If you go that route, double-check to ensure that a $600 policy will cover every non-insured "handyman" that works on your property and not just one individual person. It would be better to hire only vendors who carry worker's compensation if you can help it as that business choice, which is free for the HOA, will save you cash and headache.
BillH10
(Texas)

Posts:410


02/02/2015 11:58 AM  
Since I commented on this topic some days ago, and some of you questioned whether or not a WC policy would cover association volunteers, I thought it would be appropriate to research and share the specific language in the WC policy.

(under) Employers Liability Insurance:

F. Employers Liability Insurance: Part Two (Employers Liability Insurance applies to bodily injury covered by this endorsement as though the State of Employment shown in the Schedule were shown in Item 3.A of the Information Page.)

(then below in the schedule description)

Voluntary compensation for all board members and committee members working on behalf of the association in their official capacity. Any volunteer working on behalf of the association via an official motion of the Board of Directors. This applies to activities for which a specific license or training is not required.

WC 00 03 11


Clearly, the BOD will have to specifically direct the committee or volunteers, through a carried motion, to undertake the activity.

MichaelS42
(Georgia)

Posts:1


10/31/2019 1:33 PM  
Our HOA has a number of members who do volunteer work such as putting up holiday decorations or doing painting, gardening, and other odd jobs. They are not paid. What policies are available to cover them should they be injured? Either insurance company name or another source that we can use to obtain coverage such as you describe. We are in GA.

Similarly, we provide "casual labor" jobs in the summer for our teens. We ask them to keep the pool area clean, put/takedown umbrellas, etc. We pay them about $150 per week for 1-2 hours a day. They are not employees per se. Most teens receive about $300-$450 over the course of the summer. In a few cases, when they receive over $600 we submit an IRS form 1099 to the IRS. How do we cover them for possible injuries while helping the association?
MarkM19
(Texas)

Posts:448


10/31/2019 5:01 PM  
So I know this is a old post from 2015 but still so relevant as we approach the Holidays. When I was on my last board in Ca. Board members including myself would put up 4 foot tall lights on our street light poles. We were in a Private community. It would be fairly easy for one of us to get hurt if we were not fit or lost balance on a 10 ft. ladder. I was told by our PM that our D & O policy would cover if it the board was doing the work. Where we mislead?

Now living in Texas and back as the President of our association looking for someone to install lights around our Community. Our past President had done it in the past with teen helpers that he paid with Gift Cards. He has moved out of the community but said he is interested in continuing to do the installation of the lights for a fee. I have asked him to check into Event Insurance from his broker for the days he will be doing the work. Any thoughts about this as a option?
AugustinD


Posts:1990


10/31/2019 5:14 PM  
Posted By MarkM19 on 10/31/2019 5:01 PM
So I know this is a old post from 2015 but still so relevant


I agree.


as we approach the Holidays. When I was on my last board in Ca. Board members including myself would put up 4 foot tall lights on our street light poles. We were in a Private community. It would be fairly easy for one of us to get hurt if we were not fit or lost balance on a 10 ft. ladder. I was told by our PM that our D & O policy would cover if it the board was doing the work. Where we mislead?


I think so.

Now living in Texas and back as the President of our association looking for someone to install lights around our Community. Our past President had done it in the past with teen helpers that he paid with Gift Cards. He has moved out of the community but said he is interested in continuing to do the installation of the lights for a fee. I have asked him to check into Event Insurance from his broker for the days he will be doing the work. Any thoughts about this as a option?


What do your covenants say about insurance and contractors?

Unless this gentleman has a business where he installs lights, with all the usual insurance, I am thinking a HOA attorney would advise against this.

MichaelS42, talk to your HOA's insurer.
MarkM19
(Texas)

Posts:448


10/31/2019 6:51 PM  
Quick horror story about HOA insurance agents. When I was first elected to the Ca. board back in 2008. I was assigned the treasurer position and I decided to question many high rates we were paying. At that time we were being charged 25k annually for our Insurance package for a Pool and 2 other buildings and parks and open space. I said we need to get 3 competitive bids for these insurance coverages. The PM quickly said that the carrier does over 100 of their properties and no one could beat those prices. Well I said if that is the case it will be easy to see when we get the other quotes. When he told the broker we were going out for bid he suddenly lowered our rates by 10k per year. He was ripping off over 100 HOAs that bought the PMs comments.

Trust but always verify. It is not wise to go insurance swapping but don't be taken advantage of by not shopping rates.
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