Hurricane Season and Your HOA: Is Your Master Policy Ready?

Whether your homeowners association (HOA) oversees a condominium complex, gated community or townhome development, you likely require robust and versatile insurance coverage. An HOA insurance policy can help address many coverage needs and establish financial protection against many common incidents, but in the midst of the Atlantic hurricane season, Florida communities must fully understand any limitations and exclusions.

What Is an HOA Policy?

An HOA insurance policy is a critical part of your community’s financial stability and security. While individual homeowners and condo residents are generally responsible for insuring the interiors of their homes and personal belongings, HOA coverage is usually needed to financially protect the exteriors of shared buildings, as well as their infrastructure and common areas. For example, if a fire damages the outside of a condo complex or its electrical systems, your HOA could pay out for repairs.

Will My Coverage Address Hurricane-related Losses?

The capabilities, coverages and other details of an HOA insurance policy can vary significantly. Many include coverage for fires, vandalism, explosions and structural damage caused by vehicles, but severe weather can be more of a grey area. When it comes to hurricanes, you’ll want to fully understand the following aspects of your insurance:

• Flood coverage—Damage caused by external water entering buildings or other HOA property is typically excluded from many policies. As such, you may need alternative flood insurance purchased through the National Flood Insurance Program or a private insurer.
• Windstorm coverage—The powerful winds of hurricanes can inflict devastating damage to roofs, windows, walls and other parts of your community. Such losses are often covered by HOA insurance, but you should verify this before a storm hits.
• Named storm deductibles—Your policy may include a separate deductible for losses caused by named storms, such as hurricanes. These are amounts you contribute for covered losses and are often calculated as a percentage of a property’s total value. For example, if an HOA’s shared building is valued at $2,000,000, a 5% named storm deductible would require it to pay $100,000 out of pocket for a claim before insurance kicks in.

Learn More

At The Turner Advisor Group, we can help HOAs in Florida understand and address their coverage needs, including those pertaining to hurricanes. Contact us today to get started.

This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.