Property insurance is one of the most important components of protection for common interest communities. It protects the property, association, corporation, board members, and residents from potentially financial consequences in the event of legal liability and physical disasters. If you are unfamiliar with what that exactly entails, the following will serve as an introduction.
Types of Policies
Co-op and condominium associations generally purchase three types of insurance: basic general liability, directors and officers coverage, and an umbrella liability policy.
Basic general liability insurance policies cover property damage, bodily injury, medical payments, defense costs, and personal injury.
Directors and officers (D&O) insurance is a form of liability insurance that covers board members of a corporation or association as indemnification for losses or advancement of defense costs in the event that damages are the result of a good-faith decision made by the board or board member.
Umbrella liability insurance is extra precautionary insurance. It is designed to help protect from major claims and lawsuits, and as a result it helps protect assets. It does this by providing additional liability coverage above the limits of other policies.