Condo building and HOA insurance to protect your livelihood.

Insurance for Florida condominium associations and HOAs can be challenging, particularly for properties located along the coast. Between hurricane exposure, flood risks, building replacement costs, and changing insurance market conditions, condominium associations face a number of considerations when purchasing and renewing their insurance.

At Insurance Resources, condominium association insurance is one of our primary areas of focus. Our independent insurance agency has extensive experience working with condominium associations throughout Florida, particularly in St. Petersburg, Treasure Island, St. Pete Beach, Madeira Beach, Clearwater Beach, and the surrounding Tampa Bay communities.

Why Florida Condominium Association Insurance Can Be Complicated

Condominium associations have insurance considerations that differ from those of many other commercial properties.

Unlike a typical commercial building, condominium properties can involve multiple unit owners, shared building components, common areas, association responsibilities, and individual insurance policies.

Florida condominium associations must also consider the state’s insurance requirements, including certain provisions under Chapter 718 of the Florida Statutes.

For coastal condominium associations, hurricane and flood exposure can further complicate the insurance process. Some insurance companies may have restrictions based on a building’s location, age, construction type, roof condition, or proximity to the coastline.

In addition, insurance companies may request updated replacement cost appraisals, wind mitigation reports, building inspections such as a Milestone report, or other underwriting documentation.

These factors can affect both insurance pricing and the availability of coverage.

Working with an insurance agency that regularly handles Florida condominium associations can be beneficial when evaluating the available insurance markets and comparing proposals.

Insurance Coverages for Florida Condominium Associations

A condominium association’s insurance program often consists of multiple policies covering different types of property and liability exposures.
While every association is different, the following are some of the common coverages we work with.

Commercial Property & Windstorm Insurance

Commercial property insurance is typically one of the largest expenses in a Florida condominium association’s insurance budget. Property insurance generally addresses direct physical damage to insured buildings and other covered property caused by certain covered perils, subject to the policy’s terms, conditions, and exclusions.

For coastal condominium associations, windstorm and hurricane coverage are particularly important considerations. Depending on the insurance company and property characteristics, an association’s property coverage may be written through one insurance policy or multiple policies addressing different exposures.

When comparing property insurance proposals, some of the important considerations include:
• Building Replacement Cost: Insurance limits are commonly based on estimated reconstruction costs rather than real estate market values.
• Hurricane Deductibles: Many Florida condominium policies contain percentage-based hurricane deductibles, which can result in significant deductibles following a covered hurricane loss.
• Other Windstorm Deductibles: Some policies distinguish between hurricane losses and other wind or hail losses.
• Ordinance or Law Coverage: Depending on the policy, this coverage may address certain additional costs associated with complying with applicable building codes following covered property damage.
• Coinsurance Requirements: Some property policies contain coinsurance provisions that can affect claim payments when insured values do not satisfy policy requirements.
• Water Damage Coverage: Insurance companies may apply different limits, exclusions, or conditions to water damage claims.
• Equipment Breakdown: This coverage may be available as part of the property policy or through a separate insurance policy.

These differences can be important when evaluating competing insurance proposals. Two policies with similar premiums may have materially different deductibles, exclusions, or coverage provisions.

Flood Insurance for Condominium Associations
Flood insurance is another significant consideration for Florida condominium associations, particularly those located in coastal communities. Standard commercial property insurance policies generally exclude damage caused by flooding, including storm surge.

Depending on the property and eligibility requirements, condominium associations may obtain flood insurance through the National Flood Insurance Program (NFIP) or private flood insurance companies.

For eligible residential condominium buildings, the NFIP offers the Residential Condominium Building Association Policy (RCBAP). The RCBAP has specific eligibility requirements, coverage limits, deductibles, and policy provisions. Private flood insurance policies may offer different limits, deductibles, and coverage terms.

When comparing flood insurance proposals, some of the considerations include:
• Building replacement cost estimates
• Available building and contents limits
• Flood zones and elevation information
• Deductible options
• NFIP versus private flood insurance
• Policy exclusions and coverage limitations

It is also important to understand that the insurance responsibilities of condominium associations and individual unit owners can differ between property insurance and flood insurance.

Even associations located outside high-risk flood zones may have exposure to flooding.

General Liability Insurance

Condominium associations can face liability claims arising from their common areas and association operations. Some common exposures may involve swimming pools, parking garages, sidewalks, stairways, balconies, recreational facilities, and other common property.

Commercial General Liability insurance generally addresses certain covered claims involving bodily injury, property damage, and personal and advertising injury, subject to the policy’s terms, conditions, and exclusions.

Coverage provisions can vary between insurance companies, particularly with respect to certain activities, amenities, and property characteristics.
Associations may also want to consider the available liability limits and any significant exclusions when comparing insurance proposals.

Directors & Officers Liability Insurance

Serving on a condominium association board comes with fiduciary responsibilities involving finances, maintenance, assessments, insurance decisions, and community operations. Disagreements involving these decisions can sometimes result in legal claims against the association or its board members.

Directors & Officers (D&O) Liability insurance may provide coverage for certain claims alleging wrongful acts in the management of an association.
D&O insurance is different from General Liability insurance, and the two policies address different types of exposures.

Some considerations when reviewing D&O proposals include:
• Available liability limits
• Deductibles or self-insured retentions
• Defense costs and related policy provisions
• Coverage for the association and insured individuals
• Exclusions and limitations
• Claims-made policy provisions

Not all D&O policies are written the same way, and differences in policy wording can be important.

Crime & Fidelity Insurance

Condominium associations often maintain substantial operating funds, reserve accounts, and special assessment funds. Crime and fidelity insurance provides coverage for certain financial losses involving employee dishonesty, theft of funds, forgery, or other covered acts.

Florida condominium associations are also subject to certain fidelity bonding or insurance requirements under the Florida statutes. When evaluating coverage, associations may consider their financial exposure, policy limits, and the role of any third-party property management company.

Commercial Umbrella & Excess Liability Insurance

A significant liability claim could potentially exceed the limits provided by an association’s underlying liability policies. Commercial umbrella and excess liability insurance may provide additional limits above designated underlying policies.

For condominium associations, available coverage terms can vary based on building characteristics, amenities, underlying insurance, and insurance company underwriting requirements.

Some umbrella and excess liability policies also contain exclusions or limitations that differ from the underlying policies. For this reason, it is important to consider more than just the additional liability limit when comparing proposals.

Other Insurance Coverages

Depending on the association’s operations and exposures, additional insurance options may include:
• Equipment Breakdown Insurance
• Workers’ Compensation Insurance
• Cyber Liability Insurance
• Employment Practices Liability Insurance
• Environmental or Pollution Liability Insurance
• Legal Defense Coverage

The availability and applicability of these coverages depend on the association’s circumstances and the insurance markets involved.

What Affects Condominium Association Insurance Premiums in Florida?

One of the most common questions we receive is why insurance premiums vary so significantly between condominium associations.

There are several factors that can influence both the cost and availability of insurance.

Location and Coastal Exposure

Location is one of the primary considerations for Florida condominium property insurance. Properties located near the coastline may have greater hurricane and windstorm exposure, which can influence underwriting requirements and available insurance markets.

Building Age and Construction

Insurance companies commonly consider building age, construction materials, number of stories, roof characteristics, and other building features. Older condominium buildings may face additional underwriting requirements, particularly when certain building systems or components have not been updated.

Building Replacement Cost

Property insurance premiums are influenced by the amount of insurance carried on the buildings. Replacement cost estimates can change over time due to construction costs, labor expenses, building characteristics, and other factors.

For condominium associations, replacement cost appraisals are also an important consideration under applicable Florida insurance requirements.

Roof Condition and Wind Mitigation

Roof age, roof condition, roof covering, and available wind mitigation features may affect insurance eligibility and pricing. Significant discounts can be available for reinforced concrete roof decks and opening protection.

Claims History

Prior property or liability claims can influence insurance company underwriting decisions. The number, type, severity, and circumstances of prior claims may affect the markets available to an association.

Deductibles and Coverage Options

Different deductible options, coverage limits, and policy provisions can influence premiums. For example, a proposal with a higher hurricane deductible may have a lower premium than one with a lower deductible, although other policy differences may also affect pricing.

Insurance Market Conditions

The Florida insurance marketplace changes over time. Insurance company appetite, reinsurance costs, capacity, and competition can all influence pricing and availability. An insurance company that was competitive for an association in a prior year may not necessarily offer the most competitive option at the next renewal.

Why Work With Insurance Resources?

Insurance Resources has served Florida insurance customers since 1999.
Condominium association insurance is a significant part of our commercial insurance business, and our team regularly works with condominium boards and property managers throughout the Tampa Bay area and across Florida.
We have extensive experience with coastal condominium properties, including buildings facing hurricane exposure, flood risks, older construction, and changing insurance underwriting requirements.

Independent Insurance Market Access

As an independent insurance agency, we are not limited to representing a single insurance company. We work with multiple available insurance markets, including admitted and surplus lines carriers, to obtain and compare insurance proposals.

Depending on the property and insurance markets involved, coverage may be available through different companies, policy structures, or combinations of insurance policies.

Our goal is to present competitive available options while helping associations understand important differences between proposals.

Comparing More Than Just Premiums

We understand that insurance costs are an important part of every condominium association’s operating budget. However, the lowest-priced insurance proposal is not always the most attractive option. Differences in deductibles, insured values, coverage limits, exclusions, and policy conditions can affect how insurance policies respond to claims.

When presenting insurance proposals, we discuss material differences in available options when appropriate, allowing boards and property managers to consider more than just the annual premium.

Working With Condominium Boards and Property Managers

We understand that condominium insurance decisions often involve multiple board members, property managers, and budget considerations. Our team regularly works with associations throughout the insurance renewal process, including gathering underwriting information, marketing coverage, obtaining proposals, and coordinating the placement of selected policies.

We are also available to discuss proposals with board members and property managers by phone, video conference, or other arrangements when appropriate.

Understanding Florida Condominium Master Insurance Policies

Another common question involves the difference between the condominium association’s master insurance policy and the insurance carried by individual unit owners.

For Florida residential condominium associations, Section 718.111(11) of the Florida Statutes addresses certain property insurance requirements and responsibilities.

Generally, the association’s property insurance responsibilities include certain building components and common property, while individual unit owners are responsible for insuring certain interior items and personal property.

For example, the statute identifies certain items generally excluded from the association’s property insurance responsibility, including floor coverings, wall and ceiling coverings, appliances, certain fixtures, cabinets, countertops, and window treatments located within individual units.

However, the allocation of insurance responsibilities can depend on the applicable law, governing documents, property characteristics, and the circumstances involved.

The responsibilities for flood insurance also differ from those applicable to the association’s property insurance.

Condominium associations and unit owners should review their individual insurance needs and consult appropriate legal advisers when questions arise regarding insurance responsibilities.

Frequently Asked Questions About Florida Condo Association Insurance

What insurance does a Florida condominium association need?

Florida condominium associations are subject to certain insurance requirements under Chapter 718 of the Florida Statutes.

Common insurance policies may include commercial property, flood, General Liability, Directors & Officers Liability, crime and fidelity, and umbrella or excess liability insurance.

The specific requirements and insurance options depend on the association’s circumstances, applicable law, governing documents, and other factors.

How much does condominium association insurance cost in Florida?

Condominium association insurance premiums vary considerably based on building values, location, construction, roof characteristics, loss history, deductibles, coverage selections, and insurance market conditions.
Because each association has different characteristics, insurance pricing can vary significantly even between buildings located in the same community.

Is flood insurance required for a Florida condominium association?

Flood insurance requirements may depend on the property’s flood zone, lender requirements, governing documents, and other applicable requirements.
Even when flood insurance is not required, flooding and storm surge can present significant financial exposures so we suggest all condominiums in Florida to have coverage whether or not they are in a special flood hazard area.

What is a hurricane deductible on a condominium master policy?

Many Florida condominium property insurance policies contain percentage-based hurricane deductibles. Depending on the policy, the deductible may be calculated using a specified percentage of an applicable insured value.

This can result in a substantial deductible following a covered hurricane loss.
Associations should consider both the deductible percentage and the policy’s method of calculating the deductible.

What is Ordinance or Law coverage?

Ordinance or Law coverage may provide insurance for certain additional costs associated with complying with applicable building codes following covered property damage. Available coverage can vary by insurance company and may include separate limits or provisions for different types of costs. The applicability of coverage depends on the policy and circumstances of the loss.

Can a condominium association change insurance companies before renewal?

In some circumstances, an association may be able to cancel an existing insurance policy before its expiration date. However, certain policies contain minimum earned premium provisions, cancellation restrictions, or other terms that can affect the amount of any return premium.

Associations considering a midterm change should evaluate the applicable cancellation provisions and replacement coverage terms before making a decision.

When should a condominium association begin shopping its insurance renewal?

Starting the renewal process in advance can provide additional time to gather underwriting information, approach insurance markets, and evaluate proposals.
The appropriate timeline varies depending on the association’s characteristics, insurance markets, and underwriting requirements; however, we typically recommend at least 5 months ahead of the renewal date.

For some associations, updated appraisals, inspections, or other documentation may be needed before insurance companies can complete their underwriting review.

Can an association obtain insurance from more than one insurance company?

Depending on the property and insurance markets involved, condominium associations may have insurance programs consisting of multiple policies issued by different insurance companies.

For example, property coverage excluding windstorm and separate windstorm coverage may be available in certain circumstances.

Each policy’s terms, limits, deductibles, and exclusions should be considered when comparing these arrangements.

Let Us Compete for Your Condominium Association’s Insurance

If your condominium association is approaching renewal, considering a change in insurance agents, or simply interested in exploring alternative insurance options, we would welcome the opportunity to earn your business.

At Insurance Resources, we regularly work with Florida condominium associations and property managers to market insurance programs and obtain competitive proposals from available insurance markets.

Our agency is located in St. Petersburg, Florida, and serves condominium associations throughout the state, with a strong concentration in the Tampa Bay coastal communities.

Contact our office to discuss your association’s insurance needs or request a proposal.

The above description provides a brief overview of the terms and phrases used within the insurance industry. These definitions are not applicable in all states or for all insurance and financial products. This is not an insurance contract. Other terms, conditions and exclusions apply. Please read your official policy for full details about coverages. These definitions do not alter or modify the terms of any insurance contract. If there is any conflict between these definitions and the provisions of the applicable insurance policy, the terms of the policy control.

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