When a loss occurs at a homeowners association (HOA) or condominium association (COA), emotions can run high. Water damage, fire, storms, and other unexpected events often leave owners looking for answers and wanting immediate action. However, one of the biggest mistakes an association can make is allowing individual unit owners or members to report claims directly to the insurance carrier that provides the association’s master insurance policy.
Instead, all claims involving the association’s master policy should be coordinated through the Property Manager or the Board of Directors.
The Problem with Multiple Owners Reporting the Same Claim
Imagine a water pipe bursts in a building and damages several units. Concerned owners begin calling the association’s insurance company individually to report the damage.
What should have been one claim for a single incident can quickly become several separate claim reports in the insurance carrier’s system.
This creates several problems:
-
Duplicate claim records may be opened for the same event.
-
The carrier may receive conflicting information from different owners.
-
Adjusters may spend additional time sorting through multiple reports.
-
Coverage determinations can become delayed.
-
The association’s loss history may become cluttered with multiple claims arising from a single occurrence.
Insurance companies review loss runs and claims history when underwriting and pricing HOA and COA insurance policies. Multiple claims reported from the same event can create confusion and potentially impact future renewals and premiums.
The Property Manager or Board Should Be the Single Point of Contact
To avoid confusion and ensure accurate communication, the Property Manager or Board of Directors should serve as the primary point of contact between residents and the insurance carrier.
Benefits of having a single point of contact include:
-
Consistent reporting of facts surrounding the loss.
-
Better coordination with insurance adjusters.
-
Improved documentation of damages.
-
Faster resolution of claims.
-
Reduced risk of duplicate claim reporting.
-
Better protection of the association’s insurance record.
The Board and Property Manager can gather information from affected residents and communicate directly with the adjuster, ensuring the claim is handled efficiently and accurately.
Not Every Loss Belongs on the HOA Master Policy
Another common mistake occurs when owners automatically assume every property loss should be reported under the association’s master insurance policy.
In many cases, damage that is limited to an individual unit should be reported to the owner’s personal condominium unitowners policy (commonly referred to as an HO-6 policy).
Examples may include:
-
Interior water damage within a single unit.
-
Personal property losses.
-
Improvements and betterments made by the owner.
-
Loss assessment coverage situations.
-
Personal liability claims involving the unit owner.
The association’s master policy is designed to protect the common elements and the association’s insurable interests. It is not intended to serve as the first source of coverage for every issue that occurs within an owner’s unit.
Before reporting a claim, owners should contact the Property Manager or Board to determine which policy may apply.
Protect Your Association’s Claims History
A well-managed claims process helps protect the association’s insurance record, reduces confusion, and improves communication between residents, management, and insurance adjusters.
The best practice is simple:
Residents should report incidents to the Property Manager or Board of Directors—not directly to the master insurance carrier.
By maintaining a centralized claims reporting process, associations can help ensure that one event is handled as one claim and that the appropriate insurance policy responds.
Need HOA, COA, or Condo Unit Owners Insurance?
Insurance Incorporated specializes in insurance solutions for:
-
Homeowners Associations (HOAs)
-
Condominium Associations (COAs)
-
Commercial Condo Associations
-
Individual Condo Unit Owners (HO-6 Policies)
Whether you need a quote for an association master policy or an individual condo unit owners’ policy, our experienced team can help.
Call Insurance Incorporated today at 877-898-9333 or click here to request a quote online.
