Archive for Current Condominium Issues

10 questions to ask when insuring your condominium association

You are no expert. You might know a lot, that is why you got the job to review your associations insurance.

Let’s hope that your agent is and expert and is looking out for your best interest, and not the biggest commission.

Ask these Ten questions:

  1. Is our policy all in all the time? What are the restrictions, and does it dovetail with my bylaws and master deed?
  2. Do I have enough liability insurance? Do I at least have $2,000,000 per occurrence?
  3. Do I have a retro date on my Directors & Officers coverage? Do I have the coverage at all?
  4. Does our policy cover our expenses in handling a claim such as our time, the property managers time and charges by the adjusters we hire on our behalf.
  5. Have we had an increase in premium lately?
  6. Can we lock in our rate for more than a year
  7. What type of replacement cost coverage do we have?
  8. Are we insured to value?
  9. Are our finances covered? loss rents and maintenance fees?
  10. How many different deductibles do we have?

Bonus question:

Are you working with me? How am I getting communication? newsletters, alerts, loss control; and a partner when we have a claim.

There are many more questions to ask your agent or company that you buy insurance from. Try these on for size to start. If you don’t get the right answers, start walking.

How to get an insurance quote for your community association


hurricane guide book for condominiums

Are you ready when the wind blows?

Probably not.

Be prepared.

click here: Hurricane Guide Book   for a great reference on how to prepare for a hurricane from the law firm of Katzman,Garfunkel & Berger.



Flood insurance impacts sale of condo

The new changes in the flood laws can impact the pricing of flood insurance and the sale of your condo, depending on where you are.

From an article by Chris Heidrick:

Last July, Congress passed the Biggert-Waters Flood Insurance Reform Act of 2012 (BW12), which provided for a sorely needed five-year re-authorization of the National Flood Insurance Program (NFIP).

However, FEMA just recently has started to release details of other provisions of the act that will have significant financial impacts on local homeowners, commercial property owners and condominium associations.

Sanibel based Heidrick & Co. Insurance and Risk Management Services ( was one of just 40 agencies throughout the United States in attendance with FEMA officials at the National Flood Insurance Conference in Anaheim, Calif., last week where details were released and clarified.

The most significant section of the act immediately eliminates rate subsidies on structures built prior to 1979 on Sanibel and 1984 on Captiva, Fort Myers Beach and many parts of mainland Lee County. Rates for these structures have been artificially low since the inception of the NFIP in 1968. Premiums for these policies will increase from a range of $1,200 to $2,400 to at least $3,000 and in many cases to well over $10,000 per year. While the new rates have not yet been released, indications are available. Government and industry leaders all agree on the enormity of the increases.

Residential, Commercial and Condominium Association policies that were in effect prior to the act (July 6, 2012) will have the increases phased in over the next several years through annual increases of 20 to 25 percent per year. However, policies that were purchased on or after July 6, 2012 will require owners to obtain an Elevation Certificate and will be re-rated at the new, higher rate at the first renewal after Oct.1, 2013. Buyers of older, ground-level homes/buildings should have an Elevation Certificate done by a surveyor now and ask their agent how their premiums may be impacted at the next renewal. Some people may struggle to pay premiums that increase as much as 500 percent at their next renewal. Owners of all structures located in a Special Flood Hazard Area and having a mortgage are required to maintain flood insurance.

Selling impacted properties may also become more difficult as buyers who require a mortgage may be reluctant to purchase a property that requires a $10,000 per year flood insurance policy. In some cases the only way to escape the impact of BW12 may be to elevate the building.

And, as if these increases are not painful enough, there are several other provisions in the law that will further increase flood premiums today and in the future.

Any building that has been “substantially improved greater than 30 percent of its fair market value” will immediately be subject to the new, higher rates. This threshold is lower than the “50 percent of fair market value” threshold that triggers conformance requirements under FEMA construction guidelines. However, if the improvement elevates the building above Base Flood Elevation it could result in a decrease in flood insurance premiums.

Building and Community Officials should be advising citizens that there are significant credits provided for exceeding FEMA requirements. Often buildings are constructed to meet FEMA requirements, which are a minimum standard. Exceeding those standards by elevating just one additional foot could decrease flood premiums over 50 percent.

Further, the practice of “grandfathering” will be phased out beginning in late 2014. Grandfathering allows a property owner to continue to pay lower rates after a revision to flood maps indicate an increased hazard for that property, saving some property owners thousands of dollars.

For owners of properties impacted by BW12 there is one glimmer of hope that has recently surfaced. On May 7, 2013, Sen. Mary Landreiu of Louisiana introduced an Amendment to the Water Resources Development Act (WRDA) that would stop premium rate increases for NFIP coverage until FEMA conducts an affordability study and there is adequate time to act on the findings. Homeowners and citizens should contact Sen. Bill Nelson and Sen. Marco Rubio to express their concerns about Biggert-Waters and ask for support of Sen. Landreiu’s Amendment to the Water Resources Development Act.

neighborhood association insurance needs

I live in a condo and we have our own insurance needs.

But what do you need for insurance if you have a neighborhood association?

There are 1000′s of neighborhood associations around the country. These associations bind a community together and create guidelines for living and a place for community involvement.

What are the risks?

  1. people
  2. property
  3. liability

Take for example a urban neighborhood association that forms to bond a 10 block radius of people that own their own homes or units. They band together for a common bond and sense of community.

What do they need for insurance? Let’s assume that they are a serious and real association, with rules, guidelines, officers, meetings and events.

Insurance needs are:

  1. Directors & Officers liability- protecting the board against improper decisions, or claims against them
  2. property insurance- do you have an office, own real property? Then it needs to be protected against fire and theft
  3. liability- Let’s face it, people injure themselves and sue, and you create property damage and people sue you.
  4. Special events- wine tasting parties, block parties, charity functions,dances, and the pancake breakfast. Whether you rent a jumpy trampoline for the kids or not, these events all create a unique liability issue and need to be insured.
  5. Workers compensation- Do you hire anyone? Do you hire a landscaper to mow common area, or do you hire security people. If you hire people, you need workers compensation.


how do condominiums affect the economy?

Cold hard facts:

  • In 2012, association boards supervised the collection of close to $40 billion in annual assessments and maintained investment accounts of more than $35 billion for the long-term maintenance and replacement of commonly held property.

Condominiums matter and pump billions into the economy every year in sales, maintenance and fees.

I have no idea how much money is spent on condominium insurance. But let’s make a guess. I guess that $1000 is spent for insurance on average by every unit owner. This is based on their own personal insurance, and the proportionate share of the master policy.

With 1.25 million units, that is over 1 Billion dollars.

Just a guess, but that is a bunch of zero’s.

Condo unit owners matter.

Should I get a home sprinkler system for my condo

Home sprinklers save lives.  fact

What is the cost benifit?

5 myths about home sprinklers.




1. When one sprinkler goes off, all the sprinklers activate.

The sprinkler heads react to temperatures in each room individually, allowing only the sprinkler closest to the fire to activate. In fact, 90 percent of fires are contained by the operation of just one sprinkler.

2. A sprinkler could accidentally go off, causing severe water damage to a home.

Records show that the likelihood of this occurring is very remote. In addition, residential fire sprinklers are designed and tested to minimize such accidents.

3. Water damage from a sprinkler system will be more extensive than fire damage.

The sprinkler system will limit a fire’s growth. Therefore, damage from a residential sprinkler system will be much less severe than the smoke and fire damage if the fire had continued unabated, or the water damage caused by firefighting hose lines.

4. Home sprinkler systems are expensive.

The cost of installing home fire sprinklers averages $1.61 per square foot for new construction, according to the Home Fire Sprinkler Cost Assessment report produced by the Fire Protection Research Foundation. To put the cost of a sprinkler system into perspective, that is roughly the same amount people pay for carpet upgrades, a paver stone driveway or a whirlpool bath – none of which save lives.

5. Requiring residential fire sprinklers will inhibit new home construction.

A 2009 study conducted on behalf of the National Fire Protection Association (NFPA) compared residential home construction in four counties in Maryland and Virginia – two with sprinkler mandates and two without. The study concluded the presence of sprinkler mandates did not have a negative effect on the number of homes being built.


* info from the Claims Journal

Exclusive rights use for your condominium

What is exclusive rights use in a condominium? How does it work?

In a condominium, there is shared use. There are common areas and common amenities and shared expenses.


But you have under the deed and by-laws in many cases the exclusive use of some areas. These areas can be:

  • Your unit
  • your driveway
  • your parking spot
  • your yard
  • your deck or roofdeck
  • your balcony

No one has the right to infringe on the exclusive use of your area. People are funny and territorial. They slowly take over your land and your space if you let them. They use your space if you are not using it.

Set your neighbors straight. Tell them that while we are in a shared community, there are places that they cannot go. It is trespass, and it is illegal.

There may be some instances where someone can have access rights to walk through, or dig for utilities etc, but your exclusive use is yours to use within the guidelines set forth in the condominium documents.


Can I be forced to buy condo insurance?

Can you be forced to buy condo insurance? Yes and NO.

If your condo documents insist, and you sign on, then you must. If you have a mortgage and one of those 500 pieces of paper that you never read but signed at the closing says so then Yes.

But if you have no mortgage and no documents to say that you have to, then you can make your own decision. If you choose not to, it is a BAD decision, but one that you can make.

Rules for gas grills in Boston

Because I am from Boston and insure condominiums, I get this question all the time.

Can we have a grill in our condominium?

According to the city of Boston Article (1) section 1.05(b)


city of Boston reference site: Click here

I hear that the enforcement of the rule is much like jaywalking. It is illegal, but everyone does it.

Comment from a condo unit owner in Boston

” I know that grills are illegal, but every warm summer night, my deck on my condo is smothered in the scent of burning and smoking meat. I don’t eat meat and I know it is illegal, what do I do”?


The question is what does the insurer do? Can they deny a claim because it is illegal?

Does your insurance policy specifically exclude the use of grills?

The answer is yes and no. Of course it is.

You can be denied coverage for intentional acts.

condo grill fireBut most basic condo association policies do not exclude the use of charcoal or gas grills. BUT you need to read your policy and ask your insurer. special endorsements, exclusions and warrants are added all the time. Also check that you were not warned of the hazard and recommended to stop using grills. If you were and you signed off that you would comply, then watch out!

Also, check your by laws and deed. You may be already be in violation of your by-laws. I own 2 condo’s. One I can have a grill and one I cannot.

Remember: Safety First!!



Condominium fire damage

Witness the damage done by fire at a condominium complex in the Carolina’s.


Amazing footage of a devastating fire to a condominium complex.
What would you do? Are you prepared?