A condo association is responsible for the care of valuable property and assets. It owes its membership a fiduciary duty to safeguard both the property and the membership’s collective interests. It’s important for an association’s board members to understand the importance of adequately insuring a condo’s property and operations so that the association will be protected against loss or liability.
Key Coverage Considerations
In general, general liability and property insurance alone is not sufficient to protect a condo association. Condo associations should look for condo association insurance programs that offer several additional forms of coverage that may be excluded from general liability and property policies.
Directors and Officers Insurance
Individuals serving on a condominium’s board of directors should be aware that they are vulnerable to legal claims in their individual capacity. The condo membership or third parties could bring a claim against one or more board members based on alleged wrongdoing in the performance of their duties on the board. Directors and officers insurance provides valuable protection in the event of a legal claim.
The coverage levels that a condominium needs will depend heavily on the value of its property and assets as well as the scope of services that it offers to its memberships. It’s advisable for boards to review their insurance coverages with a company that has extensive experience in serving condo associations.