Our New Year’s Resolution to you this year was to take a deeper dive into insurance policies commonly held by community associations. What better place to start than the first policy most folks think about – property insurance.

First, we need to clarify the responsibility to maintain versus the responsibility to insure. Just because you are responsible for maintaining something, it doesn’t make it your fault if it fails. This trips a lot of folks up -owners, board members, managers, attorneys – it literally confuses everyone. Here’s why: since we were kids, we have been used to pointing fingers. We want to shout, “not it!” and place blame for whatever broke squarely elsewhere. When it comes to property claims, though, there usually is no need for the blame game.

It comes down to this: if the thing(s) that were damaged are covered by the insurance policy and the reason they were damaged was a covered cause of loss for that policy, then a claim on that policy should cover the repairs (less the deductible, of course).

Examples always make things easier to understand, so here is one:

An accidental fire starts in unit 101’s kitchen, damaging not just the kitchen but the bedroom of unit 201 upstairs. Do we blame the folks in 101 and make them pay for the damage? No. It was an accident. The intent of property insurance is to provide funds to repair and replace things that are damaged or destroyed by accidental means. Fires, broken pipes, cars running into buildings, etc.- those are all accidents and are most always covered causes of loss. Claims should be filed with the insurance carriers for unit 101, unit 201, and the association and each should pay to repair or replace the property they each insure.

In conclusion, remember that pointing fingers really doesn’t help the situation when it comes to property claims. Additionally, filing a claim with the association’s insurance carrier lets them sort out who is responsible for what and the board and manager don’t get pegged as “the bad guy.” When accidents happen, insurance is there to make everyone whole again.

Terri Guest, CIRMS, CMCA is the Northern California Sales & Marketing Representative for Berg Insurance Agency and may be reached at Terri@BergInsurance.com.