Property Insurance
Can an HOA self insure “property” insurance? I know of an HOA that cannot find insurance for less than $200k for a 1 year premium. Shocking. There is a pretty small number of owners, less than 150. Why not put that premium money aside for a potential property situation? But keep regualr insurance for D&O, Liability, etc.
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Barbara
I’ve never heard of this in my travels and interactions. I believe that this would be extremely risky for any association and a significant burden on the association’s members to fund such a venture. You will essentially have to fund your reserve accounts to not only deal with long-term maintenance or upgrades but also to address any hazard loss. This would result in an increased drawdown of the reserve funds based on hazard issues that are never predictable. Insurance companies work from actuarial risk assessments and the collection of premiums from a broad client base. You association has a very narrow client base to fund for the risk.
While this may be possible as a last-ditch resort it should be avoided at all cost.
Dennis