Ways to Save on Your Community Insurance

Posted on Friday July 08, 2016 |



As a board member for a Nevada HOA, fiscal stewardship is one of your primary concerns. That means looking for more ways to help your community save money—and that includes saving on insurance. Whether your HOA manages a high-rise, a condo, or a master-planned community, this is a great place to seek savings.
 
Unpacking the complexities of coverage might require a little more effort than you think. That’s why it’s a good idea to enlist the help of an HOA management company that is an expert in this area. Here are a few things to consider that will help you find the right policy—and protect your budget while you’re at it.


1. Conduct an ongoing review. You’re already familiar with the concept of checking in on different aspects of your management responsibilities to make sure you’ve planned appropriately. You do it with your reserve study, where you assess the status of your major systems to plan for major repairs and overhauls.
 
Same goes for your insurance mix. You should continually check in with your policies to make sure you’re getting the most coverage for the least amount of money. This is easier if you have a relationship with a great broker, but it’s even simpler with the help of a good HOA management company. For example, FirstService Residential has a complete affiliate, FirstService Financial, that focuses on these areas exclusively.

2. Seek the specialized coverage you need.
According to Jamie George, Insurance Product Manager at FirstService Financial, common-interest communities have unique insurance requirements. For instance, in Nevada, considerable resources are spent on landscaping, so it’s smart to find coverage that includes tree and shrub sub-limits. You’ll also want adequate general liability coverage for pools, playgrounds, and other public amenities. (Remember, having a body of water on-site often necessitates at least an additional $5 million in coverage.) Lastly, make sure the coverage you get is compliant with Nevada legislation, specifically NRS 116, as well as your community’s CC&Rs.

Sound daunting? That’s why it’s best to get your HOA insurance through a broker that is specialized in this area. Look for a broker that has the Community Insurance and Risk Management (CIRMS) designation from the Community Association Institute.

3. Plan for the process.
Shopping for your policy is no easy task. You should plan for a process that takes anywhere from 90 to 120 days. That will give you the time to fully explore your options and vet the policies that are presented. If you’re going to pursue bids on your own, know that carriers are only able to entertain one bid request at a time, so only one broker can access them in the beginning. If you want multiple agents involved, you’ll have to assign a carrier to each agent. Good HOA management companies are skilled in this area and can help do a lot of the heavy lifting for you.

4. Make sure the coverage is right.
You guessed it—there’s no one-size-fits-all solution. But ideally, you’ll want a liability policy (sometimes called an “umbrella policy”), as well as directors and officers liability coverage to protect your board and your community manager, too. In this instance, make sure there’s third-party discrimination coverage for slander, abuse, and wrongful termination. Workers’ compensation is highly-affordable and a smart insurance investment, as is fidelity insurance, which covers losses in case of theft.

5. Keep working at it.
Arriving at the right policy mix and procuring the coverage is really just the beginning. You can institute ways to manage and reduce risk in your community, which will help you save on your policies. Also, it’s important to review your insurance policies on an ongoing basis, just to make sure you’re getting the best coverage for your money. Nationwide firms such as FirstService Residential include these activities in their scope of capabilities. And because they’re a larger company, they can often leverage better policies at lower rates for their clients, too.

Large-scale communities and smaller associations can all benefit from a smarter approach to insurance coverage. For more insight, reach out to FirstService Residential, Nevada’s leading HOA management company.

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