How to Buy Florida Homeowners Association Insurance

How to Buy Florida Homeowners Association Insurance

It’s important to have Florida homeowner’s association insurance for your HOA. Before you obtain a policy, there are several things to consider. The more you know about the insurance, the easier it will be to get a policy that meets your budget and provides you with sufficient protection.

Explore Coverage Options

Before you can buy a policy, you have to explore some of the coverage options. There are going to be basics, such as property and liability coverage. These will ensure that your property is covered in the event of any kind of damage or theft. Liability will also cover you in the event of injury and lawsuits.

Beyond the basics, there are other coverage options so you have more protection in different scenarios.

Building code upgrade coverage, for example, provides coverage in the event that you have to make upgrades to a building that is out of code. Diminution in value coverage provides full value coverage if you have to tear down a building though only a percentage has been identified as damaged. The reason is that if only a percentage is identified as damaged, insurance will typically only pay for that percentage – leaving you at a loss unless you have additional coverage.

Demolition cost coverage will also cover the costs to tear down a building due to hazardous waste or asbestos. These things wouldn’t be covered in a standard policy.

Know the Details of Your Governing Documents

Florida homeowner’s association insurance is often based upon your HOA governing documents. You have to use it to identify the minimum standard of coverage. It will identify all of the pieces of property that you own so you can ensure that you have everything covered.

You’re also going to need an appraisal every 36 months so that all property is insured for the total value. Otherwise, you run the risk of insurance not covering your property for the full amount, which can leave your HOA at a financial risk.

The Florida state statute is also going to override much of what’s in your governing documents. For example, you need a replacement-cost appraisal as opposed to a market-value appraisal, regardless of what your documents might say.

Further, if your documents say that you can’t add additional coverage, you cannot do so, even if it is in the best interest of your HOA. This is why an insurance agency will request a copy of the documents when working with you on getting a policy.

Work with an Insurance Agency

An insurance agent is going to help you make sense of what you need for insurance. This includes reading through your documents to figure out not only what is required but how to gain the full level of protection.

You can ask questions to find out more about the different forms of coverage. An agent will address concerns so that you’re able to make more informed decisions about your insurance.

Plus, you can get multiple quotes to make it easier to obtain affordable HOA insurance. You can gain the coverage you need with confidence.