H03/Master policy for townhomes
I own an attached townhome in a coastal area and the exterior insurance is covered by the Hoa master policy. Premiums have increased substantially for the coming year for the HOA master policy that covers the common areas, pool and exterior of all units. The Hoa bylaws state that the Hoa will secure the exterior insurance. Based on my discussions with others in the area who have stand alone homes with an H03 policy the price increase for those has not been nearly as much. I was wondering if it might be possible to amend the hoa bylaws for the owners to just secure their own H03 polices and for the Hoa to only secure coverage for the pool and common areas? Would this create other issues? Any thoughts? The owners will be upset and think the hoa board has not been acting in their best interest if this is not able to be done I am afraid
#1 Insurance Contributor
- Insurance Agent
- Norwalk, CT
Taylor,
I have seen condo associations set it up that way. Not sure how complicated it would be to amend the bylaws. The question comes in on common elements (utility, water, heating lines that supply multiple units or Common walls, etc.). I had one, 2 unit condo, that shared only one common wall (garages shared a wall). They were able to make each unit responsible for all the Building elements for their unit.
The Insurance policy for the unit owner would might still be a condo form (Ho6) with some companies. In that senario you would have to insure the building elements under the Additions & Alteration coverage. I would suggest getting quotes to see what the cost of a reduced condo association policy (for what common elements you cant shift to the unit owners and the Assocation's Liability coverage) and the two policies for the unit owners. You may find it is not the savings you are expecting.
Quote from @John Mocker:
Taylor,
I have seen condo associations set it up that way. Not sure how complicated it would be to amend the bylaws. The question comes in on common elements (utility, water, heating lines that supply multiple units or Common walls, etc.). I had one, 2 unit condo, that shared only one common wall (garages shared a wall). They were able to make each unit responsible for all the Building elements for their unit.
The Insurance policy for the unit owner would might still be a condo form (Ho6) with some companies. In that senario you would have to insure the building elements under the Additions & Alteration coverage. I would suggest getting quotes to see what the cost of a reduced condo association policy (for what common elements you cant shift to the unit owners and the Assocation's Liability coverage) and the two policies for the unit owners. You may find it is not the savings you are expecting.
Thank You. Out of curiosity I got a quote for an H03 that I received back yesterday for my individual unit and it was a $1,200 premium for the year. The cost to insure the townhome through the association is over 5k for each townhome owner through the associations policy (88 townhomes in total) So the problem im trying to fix is a stand alone home right down the road from me cost $1200-1400 a year for insurance.. and being in a townhome (which is less overall value) is costing over 5k a year for insurance cost) that is such a large difference in the numbers that it just still doesn't make sense to me
