Property Insurance

[DvDogE8]

I live in a town home community with a town home association. They hired a management company to manage the property. My property is paid off and I have the clear deeds to it. The new management property required as of January 2000 that each owner purchase property insurance via the management company. I felt this was unnecessary due to the fact I had already purchased and paid for my own insurance on my property. I am now being sued for $217, the amount that the management company is trying to get me to pay for their insurance. Where do I stand?

 

[HomeGuru]

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by DvDogE8:
I live in a town home community with a town home association. They hired a management company to manage the property. My property is paid off and I have the clear deeds to it. The new management property required as of January 2000 that each owner purchase property insurance via the management company. I felt this was unnecessary due to the fact I had already purchased and paid for my own insurance on my property. I am now being sued for $217, the amount that the management company is trying to get me to pay for their insurance. Where do I stand?<HR></BLOCKQUOTE>

You need to find out what you insurance covers and what the Association insurance covers. It is not the same coverage although there may be some overlap. Your insurance covers your specifc townhome apartment unit and the Association insurance covers the common areas and other things. Check your Association legal documentation as there should be a clause that requires all owners as members of the association to pay for Association related expenses such as insurance. The fact that you have no mortgage has absolutely no bearing on Association required assessments. In some states the association can actually file a lien on your property for nonpayment and foreclose on the lien. You are not in a very good position to refute the charge.

 

[DvDogE8]

I understand what you are saying, but my insurance was already paid in full for the whole year of 2000. My policy covers both the building structure and the content, but the association’s only covers the building. How can they make me pay for coverage I already have & was bought and paid for before they told me I have to have coverage with them?

 

[DvDogE8]

I forgot to tell you also that I have lived here for 11 years & have always purchased my own insurance for past the past 11 years. This is the 1st year they have tried to do this...

 

[HomeGuru]

<BLOCKQUOTE><font size="1" face="Verdana, Arial">quote:</font><HR>Originally posted by DvDogE8:
I understand what you are saying, but my insurance was already paid in full for the whole year of 2000. My policy covers both the building structure and the content, but the association’s only covers the building. How can they make me pay for coverage I already have & was bought and paid for before they told me I have to have coverage with them?<HR></BLOCKQUOTE>

I highly doubt that your indivdual insurance covers the entire building structure and the common areas. If the entire building burns down will your insurance cover replacement cost to build a new building? If so your insurance premiums would a lot higher than what you have paid. Does you insurance cover fire, property damage and liability for the common areas outside your unit ie. stairways, walkways, elevators, ammenties, roof, electrical & mechanical systems, siding, doors, windows, railings, landscaping, lighting, parking areas and driveways etc. Talk to your insurance agent and the association insurance agent to find out the actual areas covered and types of coverage respectively. Find out what other types of insurance the association is paying for ie. Board of Directors liability insurance (errors and ommisions), bonding, disability and workmans comp for employees of the Association, hurricane/earthquake/flood insurance etc.

 

[I AM ALWAYS LIABLE]

My response:

Homeguru is absolutely 150% correct on this issue. You don't even need to check your own insurance policy because I can tell you without even having seen the policy that it doesn't cover what the association's policy covers. Why? You can't buy insurance coverage for property you don't own; i.e., you must have an owned, "insurable interest" in the common areas, and the like - just like Homeguru mentioned.

Your association owns the exterior of your condo, the outside walkway, etc., that are outside of your front door. Your association wants you, along with everyone else, to share in the cost of "their" insurable interest. That way, if there is a fire, flood, earthquake, or whatever, everyone will have a place to come home to.

Your insurance only covers your interior walls and the contents - - that's it.

IAAL

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[This message has been edited by I AM ALWAYS LIABLE (edited June 25, 2000).]

[This message has been edited by I AM ALWAYS LIABLE (edited June 25, 2000).]