Condo Media - November 2023 - 16

INDEMNIFICATION AND INSURANCE
INSURANCE IN THE GOVERNING DOCUMENTS
As previously noted, this topic is too extensive to
address comprehensively herein, but it is nevertheless
worth noting the following for the purposes of this article:
The documents may provide the maximum allowable
deductible under an association's general liability policy.
The terms of the governing documents cannot be
unilaterally amended by the board. While an insurance
resolution can fill in many gaps and unaddressed
procedures and processes, a resolution cannot directly
conflict with the governing documents. There is certainly
some gray area, and careful drafting of a resolution can
arguably mitigate the consequences of a cap; if the
condominium documents provide a cap on the amount of
the deductible, it might be difficult in certain circumstances
to find a financially feasible, commercially available policy.
Governing documents differ with regard to how insurance
proceeds are handled and/or disbursed. Some documents
make the board insurance trustees for the owners and
impose upon the board an obligation to make repairs inside
the units. Other documents allow and/or require the board
to disburse insurance proceeds to the unit owners and
charge the unit owners with making the repairs. If a board
intends to deviate from the required procedures set forth
in the documents, procedures which a unit owner could
arguably enforce, it is important that waivers and releases
be obtained from the affected unit owners.
The documents may require unit owners to obtain an
HO6 policy covering certain losses that are not covered
by the association's policies (e.g., loss assessment for
deductibles and other claims beyond the limits of
association coverage, etc.). The mere fact that the
documents impose the requirement upon the unit owner
does not constitute evidence that the insurance has been
placed. The requirements of the governing documents are
discrete from the terms of the policy actually placed.
The documents may require that insurance policies contain
a waiver of subrogation. Again, the mere fact that the
documents require the waiver of subrogation does not
mean that the policy itself contains a waiver of subrogation.
In order to avoid a dispute after the fact, inclusion in the
policy of that waiver has to be confirmed.
n THOMAS O. MORIARTY, ESQ., CCAL, IS A PRINCIPAL OF THE LAW
FIRM MORIARTY BIELAN & MALLOY, LLC. HE IS A FELLOW OF THE
CAI COLLEGE OF COMMUNITY ASSOCIATION LAWYERS (CCAL)
AND A CONDO MEDIA BOARD MEMBER.
COMMUNITY ASSOCIATION INSURANCE TEAM
Protecting You Is Our Business
NATIONAL STRENGTH. LOCAL COMMITMENT. Our team gives you the personalized service you want from a local agency
and the peace-of-mind protection you expect from one of the largest brokers in the U.S.
QUALITY INSURANCE BROKERAGE SERVICES: Insurance for a condominium association is different than insurance for a
home or a non-residential building. For communities that include multiple owners and common areas, it is essential to
understand the nuances of Condo Law and how it coordinates with a multitude of carriers and coverages.
CONCIERGE SERVICE: Driven to be an industry leader through an exceptional service team. We act in the best interest
of you and always in a timely fashion. Our service team is geared towards you and your needs. Bottom line, we are
proactive instead of reactive.
FOCUS ON CONDOS: At Brown & Brown, we work with and place insurance for over several hundred condo clients.
We have been focused on the niche market of condominium and real estate insurance here in New England for over
40 years.
Ready to find your solution? Let's chat...
Thomas G. Shields, CLCS
Vice President
Direct: 978 408 1231
Thomas.Shields@BBrown.com
bbrown.com
16 CONDOMEDIA November 2023

Condo Media - November 2023

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