Condo Media - February 2012 - 48

MANAGEMENT

by Glenn Montgomery

Condominium Insurance Confusion
Top 5 Questions Condominium Associations Ask
erving on a condominium association board helps ensure that the best decisions are being made for your community. Insurance is typically one issue that board members have a tough time navigating on their own. Insurance can be a complicated matter if you do not fully understand the ins and outs of your policy, so it’s important to research considerations and ask questions before making a decision. Here are the top five insurance questions that are asked by associations these days: middleman and they have targeted your business to insure. They can be very competitive and offer great products. The downside is that they have one product to offer. • Agent insurance companies deliver their products through insurance agents. These agents will represent several insurers and they can offer the best products to you with several options. • The third type is a specialty insurer. These insurers have determined that they want condominium business and have targeted them. These insurers will often have a unique understanding of your condominium and may have some unique niche coverages. These carriers write direct or through your agent. All three options are equally good. Find the right one for you, or ask for quotes from all of them. Would we save money on our policy if we did not allow rentals? This depends on the company you choose. Some restrict the percentage of rentals-to-owner-occupants allowed. Having rentals will probably not cost you more, but it may not qualify you to be insured with some companies. Why is my property manager listed as an insured on our policy? The reason is that while the property manager does have their own coverage, they might also be summoned to court if your association were to have a lawsuit filed against them. It makes sense to have your insurer also defend the property manager if they are an incidental party to a lawsuit. Are dogs excluded on our policy? Dogs are great and most people love them. The issue is that dogs cause tens of millions of dollars in claims every year. Most policies do not exclude dogs, but some companies may exclude certain breeds, and will most certainly exclude a dog with a history of biting. The issue of what dogs you can or cannot allow on your property should be addressed in your association bylaws. You should also check with your unit owner insurer to see if you have a breed exclusion. This is a small sampling of the most common questions that associations have. Should you or your fellow association members have more questions, call your agent or company representative. CM Glenn Montgomery is the Vice President and co-founder of Brownstone Insurance, and its affiliate, Murphy & Jordan Insurance. He has obtained certificates from CIC and the Insurance Institute of America.

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What makes us look more attractive to an insurance company? If you want to look good to an insurance carrier, you should be aware of a few key things. First and foremost, if you want to get the best coverage and the best pricing, insurance companies will be more apt to offer coverage if you are loss-free. Insurance companies are also attracted to your association if your property shows pride in ownership; your systems (electrical, heating, etc.) are updated and well maintained; you have a healthy reserve fund; and you have a plan to maintain the property and are proactive about preventative maintenance.

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Are all agents and companies alike? To put it plainly, no, they are not alike. They are like fingerprints — they look alike, but each one is different. There are three types of insurers: • Direct writers are the companies that deal directly with you. They have no

CONDO MEDIA • FEBRUARY 2012

Condo Media - February 2012

Table of Contents for the Digital Edition of Condo Media - February 2012