plan for the community to minimize loss and damage in a catastrophic event. Knowing in advance what needs to be done and who will do it will minimize damages and keep residents safe. The board could also decide to retain the risk and establish a method of funding the financial consequences of the loss. The board can choose to increase insurance deductibles in the policy and include a budget line item for handling the expense if there is a loss. The board can choose to fund a loss as an ordinary business expense or by levying a special assessment of owners. Many self-managed associations deal with landscaping and snow removal by transferring the risk to an insured contractor. By shifting hazardous activity to professionals with satisfactory insurance, the community is no longer responsible for the risk. The board must make sure that there is a written contract in place so that the association can be named as an Additional Insured on the policy otherwise the self-managed community may be liable for part of any claim filed. Since indemnification clauses can also limit your selfmanaged association's protection in a contractual transfer of risk, make sure an attorney reviews any contract before it is executed. June 2018 39