Insurance comes in many forms and fashions: life, health, auto, home, renters, etc. You insure yourself and the people closest to you, along with the things you care about most. You insure your life. You insure your health. You insure your car and your shelter because not only are you legally required to, but also because you cherish these facets of your life. This same philosophy applies to your homeowner’s association. Ensuring the best version of your HOA comes from securing insurance.
What is insurance?
In essence, insurance is a contract between the buyer and the seller. The seller promises the buyer to pay for whatever loss the buyer is insured for, and the buyer promises the seller to pay a premium to keep the contract intact. The fundamental types of insurance include personal, property, and liability. More specifically, regarding HOAs, some types of insurance can involve commercial property, flood, commercial general liability, umbrella, fidelity/crime, directors and officers, commercial vehicle, hired/non-owned auto, and workers compensation. Regardless of which types apply to your HOA, insurance remains a significant pillar in your association’s success, covering your assets and your reputation.
What is the purpose of insurance?
At its core, insurance serves as a safety net for sudden loss. Protecting your HOA ranges from the intricate web of legal liability to the consequences that accompany unexpected disaster. For your HOA, insurance is necessary for:
- Physical risks, community events, and attractive nuisances. The amenities and activities your HOA offers can be as dangerous as they are fun. Making certain the association is covered in case of emergencies is critical in keeping your board and homeowners safe and happy.
- Conflict resolution and lawsuit prevention. Legal disputes are unenjoyable, but not entirely avoidable. Sometimes conflict is inevitable, but insurance can help mitigate and lessen the consequences that accompany conflict.
- Data and internet security. Technology can help your HOA communicate more effectively, but data breaches can occur without warning. Insuring your HOA allows you to handle these unfortunate incidents responsibly without having to suffer the brunt of taking full responsibility.
- Financial risks and theft. Money makes the HOA go ‘round. However, sometimes monetary loss and vandalism happen. In the event of fiscal or property theft/damage, insurance can be your greatest ally in winning back whatever is lost.
- Employer, vendor, and volunteer liabilities. In addition to board members, HOA’s need other parties to share in the tasks of running an efficient association. If one of the parties causes or experiences harm, insurance helps the HOA handle the potentially costly situation.
Where is insurance found?
Depending on the specific needs of your HOA, different insurance companies may be more suited for you than others. However, SpectrumAM partners with Blue Lime Insurance Group, an insurance broker, and MintFish, an insurance premium financing company, to alleviate the intimidating process for the associations we manage. The two companies go hand-in-hand in ensuring that the process of insuring associations is easy, accessible, and smart. Our customers have access to these excellent resources, if they so choose. Whichever direction your HOA decides to go, we hope the insurance is the best fit for you.
