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Community Association Overview - DeWitt Stern · PDF fileProperty Insurance Responsibilities Association Responsibility Common Elements Structure, All Common Areas, Bare Walls, Primer,

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  • Community Association Insurance Programs


  • Insurance Requirements of the Illinois Condominium Property Act

    Summary of Essential Insurance Coverages

    Choosing Risk Management Partners For Your Association

    Insuring Your Association

  • Insurance Requirements Illinois Condominium Property Act Property Insurance Including Full Replacement Cost Coverage

    For The Building Including Coverage For The Increased Costs Of Construction Due To Building Code Requirements.

    General Liability Insurance With A Limit Of No Less Than $1,000,000.

    Directors & Officers Liability Insurance. Employee Dishonesty Insurance With A Limit No Less Than The

    Total Of The Association Operating Funds And Its Reserves Mandatory For Associations With 6 or More Units.

    Contractors And Vendors (Except Public Utilities) Doing Business With A Condominium Association Under Contracts Exceeding $10,000 Per Year Must Provide Certificates Of Insurance Naming The Association, Its Board Of Directors, And Its Managing Agent As Additional Insured Parties.

  • Insurance Requirements Illinois Condominium Property Act Authorizes the Board to Require Unit Owner Insurance and Any

    Other Insurance Deemed To Be In The Associations, Unit Owners or Boards Best Interest i.e. Workers Compensation, Employment Related Practices, Equipment Breakdown, others.

    Mandatory Property Manager Coverage on Associations Policy For Employee Dishonesty AND Manager is Required To Insure Themselves

    Unit Owners and the Association waive their rights to subrogation (can not collect from another party for damages paid on behalf of an insured).

    Source: IL Condo Property Act, 605/12 Insurance 6/1/02

  • Summary Commercial Property

    Buildings / Real Property

    Business Personal Property

    Business Income

    Building Ordinance Or Law

    Equipment Breakdown

    Sewer Or Drain Back Up



    Enhancement Endorsements

  • Property Insurance Responsibilities Association Responsibility

    Common Elements

    Structure, All Common Areas, Bare Walls, Primer, Floors & Ceilings of The Unit

    Limited Common Elements

    Balconies, Terraces, Patios, Parking, Exterior Windows & Doors

    Unit Owner Responsibility


    Carpeting, Floor Coverings, Wall Coverings (including paint but not primer), Bathroom Tile, Molding & Trim


    Appliances, Light Fixtures, Kitchen and Bath Cabinets, Sinks, Bathtubs, Showers, Faucets, Countertops and Anything Else That Has Been Added To The Bare Walls


    The Inside of Your Walls Too - If They Only Service Your Unit

    The Above Reflects Responsibilities As Defined By The IL Condo Act, 605/12 Insurance 6/1/02 Responsibilities May Vary Depending On How They Are Defined In The Associations By-Laws.

  • General Liability

    General Liability Covers Damages The Association Is Legally Obligated To Pay Due To Bodily Injury or Property Damage Resulting From The Associations Negligence.

    Medical Payments Coverage Provides A Limited Amount Coverage For Bodily Injury Caused By An Accident Regardless Of Fault.

    Garagekeepers Legal Liability May Be Necessary For Associations With Valet Parking Even If Only On Special Occasions.

  • Crime Insurance

    Crime Insurance Coverages:

    Fidelity / Employee Dishonesty: Minimum Insurance = Maximum Amount In Both Operating and Reserve Accounts - Total

    Forgery Or Alteration

    Money & Securities On & Off Premises

    Computer Fraud

  • Directors & Officers Liability Errors And Omissions Insurance

    For Claims Made Against The Association Regarding Directors And Officers Alleged Wrongful Or Negligent Actions (Or Inactions).

    Does Your D&O Policy Include Defense Inside or Outside The Limits?

    Is There An Exclusion For Failure to Maintain Insurance?

    Are Employment Related Practices Covered? Wrongful Termination, Sexual

    Harassment, Discrimination

    Additional Coverages Available:

    Breach of Contract

    Property Managers


    Committee Members


    Non-Monetary Damages*

    * More than half of claims filed are for non-monetary damages.

  • Commercial Auto

    Even If The Association Does Not Own Any Automobiles, It Could Be At Risk For An Auto Related Claim.

    Automobile Liability Is Excluded From The General Liability Policy Unless Hired & Non-Owned Auto Liability Coverage Is Purchased.

    $1,000,000 Of Hired & Non-Owned Auto Liability Usually Costs Less Than $250 Per Year.

  • Workers Compensation

    Part One Of This Insurance Policy Provides Coverage To An Injured Employee For Medical Payments, Lost Income And Permanent Or Temporary Disability.

    Part Two Provides Coverage To The Association For Lawsuits Alleging Negligence Causing A Work Related Injury.

    The Association Could Be Liable For Injuries To Uninsured Contractors, Volunteers and Board Members.

  • Commercial Umbrella

    Additional Liability Limits Are Available Through An Umbrella Policy. This Policy Can Extend Over Existing General Liability, Auto Liability, D&O Liability And Employers Liability Policies.

    Not All Umbrella Policies Are Created Equal. For Example, Some Will Not Extend Over D&O.

    In Todays Legal Environment, $1,000,000 Of Insurance Coverage May Not Be Enough.

  • Choosing A Risk Consultant ILCPAExper,se








  • Insurance Company Consideration













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