HOA LIABLILITY INSURANCES

Does any one know if it is Texas law to carry some sort of liablity insurance? We just started our HOA and currently we do not have any. We have gotten a few quotes and it would cost almost a grand a year for basic insurance. ( I personally believe it is well worth it!) Our board fees that $1000 a year is to expensive and unless it is a law they most likely will not get it.

I cant seem to find out much info about it actually being a law or not. ( Plenty of people willing to sell it though!)
Please advise...

HB

Liability insurance would cover you as a member of the board for any accident, etc. that may occur on the associations property.
Other coverage, commonly referred to as D&O insurance, that is, insurance for board members in the event for instance a board member should perform an illegal act in the name of the association, you would be protected in a law suit up to the amount of the D&O insurance.

I have sat on several boards of directors in my lifetime and was told by my attorney many years ago, if the board does not carry liability and D&O insurance, don't run for election to any board that does not carry both.

You really can't put a price on that kind of protection in light of the letigious society in which we live.

You don't mention how many memebers your HOA has. But, in the event that Texas law does not require insurance and the Board refuses to purchase it I suggest you either spread the word among your neighbors and get a majority vote, or recall the Board.

One child who wanders into the pond unsupervised and ends up in a coma for 10 years could bankrupt everyone. (again a matter of laws in your state as to homeowner liability, but it trickles down into assessments and fees regardless)

Good luck!
Lisa

Dear Marsha: Yes you can be sued yes they can take away every dime in your development will ever raise inscudeing takeing over the streets of your community and too boot invokeing a toll charge to enter or leave your home it has been done in the past and might be done in the future. There are more lawyers in just the state of florida than the entire nations of, the UK,Japan,China both chinas. And all of europe.
Next question have you ever heard of a lawyer being in a unemployment line.

Dont risk what you have protect it.
Supposeing you have a wild fire, supposeing somebody hits your walls supposeing a cop falls out of his patrol car while answering a call in your hoa. They all have unions that have lawyers on call 24/7 protect your hoa or get the heck off the board and get somebody in who realizes you are a independent city entity start acting like one not some social club. Its your home you are gambling with. I personally have learned due to a sinkhole that cost us over 5 million dollars in lawsuits and litagation to rectify and we had the best lawyers in florida and the developer is the largest in the entire nation. Who won simple the lawyers and the developers so get used to it and work around it. You can win the small battles but unless you pay close attention to records you will loose the war Good luck

I am in an 87 unit townhome development in Minnesota. We have had excellent results with State Farm - property and liability insurance for the Association. A lot of owners have also used them for individual policies.

Our Brevard County,FL HOA just received notice that our insurer, Nationwide, is no longer doing business inf FL. Our agent expects out insurance to rise to $2500 from $425 if he can find a company to write the policy.

Any info about companies writing in this area greatly appreciatied

Thanks,

Lou

BeckyW

We've only received a quote for BOD liability coverage at $997.00!!! Agent trying to obtain Property Liability and Property coverages. Not a pretty picture.

Lou

Jack,

We are in Florida, but are an 8 Townhouse Homeowner Association without much common property, unlike Condo Associations. That is why our premiums have bee so low for so many years.

There is no reason for the drastic increase in Director and Officer Liability and Association Liability premiums - they have nothing to do with the Hurricane damages the Inurance companies are crying about.

We have not been able to get a Property quote and most likely will self insure on this.

Lou

Jack,

Thanks for the good info - I'll call Lisa ASAP.

Lou

Jack,
Thanks again for your info.

I forget to answer you question about a management company. As we are only 8 units, it doen't pay for us to have a management company. We have been doing it all ourselves and our monthly fee is only $125/month which is pretty good for ocean front townhouses.

Lou

You may want to contact one of our sponsors, IHG Insurance. You can see their company profile on our HOA Professionals link the menu, but I'll put it here for reference (They offer services nationwide):

"Ian H. Graham Insurance (IHG) has served Homeowners Associations within the Nonprofit Community Association arena for over 25 years. As the premiere provider of D&O Liability and Crime products, we are the exclusive nationwide administrator for Continental Casualty Co., a CNA Member Company - rated A (Excellent) XV by A.M. Best. We also offer Umbrella coverage and Property Manager's Errors & Omissions Liability. IHG offers 24-hour turn-around on quotes and policy issuance, online application submission and an automatic policy renewal procedure"

Ian H. Graham, Insurance
a division of Affinity Insurance Services, Inc.
5161 Lankershim Blvd
Suite 240
North Hollywood, CA 91601
Phone: 800.621.2324
Fax: 866.229.3754
Email: [email protected]
www.ihginsurance.com

HB, check your Declaration. Many state that insurance must be carried and list a minimum required amount. Even if not required your HOA should have insurance - we live in a litigious society.

Hi Margaret,

Another company to try is Clanendon America which is the company our Orlando HOA ended up with after Nationawide refused to renew in our area of Florida. Two other tips we learned after this renewal - make sure the coverage is complete (i.e., the earlier recommendation about street and stop signs if need be) and the replacement cost for covered items is not under-valued ont the policy. Good luck!