Category Archives: master insurance

HOA Insurance Issues

Knowing what to expect from your HOA master insurance policy and what you need to insure on your own is important to sort out before you purchase your condo. It’s also critical to know if your HOA carries enough information to handle a catastrophe in your unit or a unit next door. Being underinsured can spell trouble, especially if your individual insurance has any missing gaps with the master insurance. 

Homeowner insurances for town homes, condos, or duplexes that are part of the master insurance of an HOA usually cover all the public, common areas of a development. This includes areas where there are amenities, elevators, and all outside features such as the roof and exterior siding. Individual homeowners need to insure only their own units, including their own personal items and appliances. In addition to insuring “things,” these two parts of any HOA insurance should also cover liabilities for injuries. 

Let’s face it, most people don’t put too much thought into insurance until the unthinkable happens. Whether it is a fire, flood, tree damage, smoke damage, or an accident, not having insurance or being underinsured can create a huge headache, not to mention a financial disaster of its own making. 

Know the Difference

From an insurance point of view, it is worth learning where the HOA insurance stops and your individual unit’s insurance should begin, so as to make sure no gaps exist that could leave you without coverage after damage occurs. You should know what the different items are that are covered by each type of insurance. Some homeowners find it helpful to use the same insurance carrier or have both carriers connect to be sure that gaps do not exist. 

 

Know the Limits 

It is also recommended that unit owners understand that there are limits to the HOA insurance. Your condo association’s master policy will cover property damage to the building and common areas, but only up to its limits. Depending on what those financial limits are, there’s always a chance that a severe incident could exceed them. If that happens, it might fall on the condo owners to make up the difference and help repair the damage.

Know the Liability Requirements

Most HOAs require that individual unit holders have some liability insurance in case a visitor gets injured in a unit. The master insurance should have liability insurance to cover common area accidents but your unit also needs to be covered. Talk to your insurance agent about how much is reasonable and if your HOA has any requirements of level of coverage.

When it comes to insurance, it is essential to know the types, limits, and requirements for your individual insurance and what is covered in the master insurance policy. If you have questions, request a copy of your HOA insurance policy and discuss what gaps need to be filled with your individual agent. 

 

Protecting Association Data from Cyber Crimes

In our last blog we examined the physical security needs of homeowners associations and how screening, communication, surveillance, and access limitations can bring peace of mind to homeowners. This week, we are looking at some of the steps an HOA and Condo associations can protect their communities from cyber crimes.

Think about all the information that a condo association has at its fingertips. The data kept for Board of Director purposes and billing purposes may include each homeowner’s name, address, phone number, email, bank check routing number, tax information, credit card number, and probably social security number.

Given the scope and depth of the data that a homeowners association has, it would stand to reason that there would be many layers of security to protect that data. Unfortunately, many HOAs do not have the resources to protect sensitive data as they should.

Knowing that defenses may be down in a small business like an HOA, hackers have been known to attack in some common ways. Here are a few questions to consider when arranging your HOA cybersecurity measures.

Who should have access to the data?

Cyber experts believe that HOA boards should determine exactly who can gain access to sensitive data and who will not be given access. Keep the list of people who will have access to only those who will need it to deal with finances and condo owner issues. In addition, HOAs should limit where the data can be accessed. Unfortunately, an association’s odds of falling victim to a successful data breach increase every time someone downloads association information and stores it on their personal computer.

 

Is there an IT consultant who can help?

Every HOA should have an expert they can call upon when there are questions about things like firewalls, dual authentication, passwords, backups, and how to maintain security for the HOA server. An HOA can hire IT experts on a full-time basis, or as contractors. This person can train personnel as to what to look for in suspect or malicious emails, viruses, and security breaches.

 

What type of cyber insurance does your HOA have?

Board members for your HOA should routinely check with their condo insurance broker about the community’s potential cyber risks and what type of cyber insurance coverage may be appropriate for your association. Known also as cyber liability, cyber risk, or data breach insurance, this type of liability insurance protects the HOA in the event of data breaches, viruses, network attacks, computer theft, and other losses or compromises of the HOA’s computers, network, or websites.

Cybercriminals only need to see a small vulnerability to make their way into your HOA data. Do you have a strong security protocol for your association? For more information contact Thayer & Associates, Inc., AMO at 617.354.6480 or visit our website.

 

HOA and Individual Insurance

No one ever thinks about insurance policies until an accident or injury happens. Then recovery and rebuilding rely upon the coverage you have. Living in a community means there are two types of insurance that homeowners should worry about: association insurance and individual insurance on the unit. Let’s take a closer look at “who covers what” when it comes to insurance coverage within an association.

What is a Master Policy?

Living in an apartment complex, condominium unit, or townhouse potentially means that you are part of an association otherwise known as a homeowners association or HOA. Many HOAs carry what’s known as a “master policy.” Generally, the Master Policy has “walls-out” coverage for all units in the building.

What is Covered Under a Walls-Out Master Policy?

This type of policy typically provides coverage for both physical damage and personal injuries. Items that are usually covered in an insurance policy of this kind may include damage to the parts of the property shared by all owners, such as roofs, common walls, lobbies or atriums, stairways, elevators, basements, fitness centers and pools, ponds or lakes, playgrounds, and clubhouses. The damage could be caused by Mother Nature, vandals, theft, or even homeowners who have experienced an accident. The governing documents of your specific HOA should state exactly which areas the HOA master policy insures.

Personal injuries that occur in the common areas and amenity areas are also usually covered under the master policy. For example, if someone slips and falls in the pool area or is injured in an elevator, those injuries would be most likely covered under the HOA master policy.

What Should Individuals Insure for their Units?

Individual homeowners need to insure only their own unit. While the master insurance covers the basic building(s) such as walls, roof, floors, and elevators, it leaves to the unit owner the responsibility of insurance appliances, carpeting, cabinets, wall coverings, and other items in the unit. Individual insurance should also cover personal property including clothing, jewelry, electronics, and upgrades you’ve made to your unit.

Using the same company that insures the master policy for your HOA as your individual insurance for your unit may have some advantages in that the company will easily be able to spot gaps in insurance. If you are not using the same company, you and your insurance specialist will want to take 

a close look and consider what is left out or what not to buy duplicate coverage for.

Do you have questions about what is covered and by whom? Call Thayer Associates at 617.354.6480 or visit our website.