ARE YOU SURE? BANKS THAT LEND TO CONDOMINIUM ASSOCIATIONS ALSO REQUIRE CERTAIN INSURANCE PROTECTIONS Banks and lenders making loans to condominium associations should require similar protections from both the association's master insurance policy, as well as the insurance policies for any contractor performing work for an association with an active line of credit or loan repayment. While the bank can ask that it be added as Additional Insured in these circumstances, the most important consideration for anyone lending to condominium associations is to obtain a "Loss Payee with Lender Loss Payable Provision Endorsement." The Loss Payable Provision endorsement is important because it obligates the insurer to make payment to 30 CONDOMEDIA March 2020 Banks and lenders making loans to condominium associations should require similar protections from both the association's master insurance policy, as well as the insurance policies for any contractor performing work for an association with an active line of credit or loan repayment. the lender for a covered loss, regardless of any wrongful act or noncompliance on behalf of the insured which may nullify coverage for the insured. The Loss Payable Provision endorsement will also entitle the lender to notice from the insurer in the event of cancellation or nonrenewal by the carrier. This endorsement creates a contractual obligation between the insurer and the lender which is not dependent on whether the borrower is entitled to the coverage afforded by the policy. Lenders who loan to condominium associations are secured parties, not mortgagees, so a typical mortgagee endorsement will likely not adequately protect the lender in these circumstances. n CHRISTOPHER S. MALLOY, ESQ., IS A PRINCIPAL WITH THE LAW FIRM MORIARTY TROYER & MALLOY LLC.