Expert Strategies & Tips For Buying HOA Insurance 

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What is HOA Insurance? 

Homeowners associations (HOA) need insurance to cover personal liability, accidental damage, and other possible legal liabilities. 

HOA insurance policy coverage is like homeowner’s insurance, but with to protect the homeowner's association employees, board members and common areas. 

Should an HOA have insurance? 

Every HOA needs to have insurance coverage.

Accidents happen everywhere, and HOA provides financial protection when those accidents occur on community property like parks, sidewalks, driveways, swimming pools, and clubhouses.

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They also protect workers who provide maintenance and repairs. 

A HOA master insurance policy also covers the board members from claims against them.

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Do I need A HOA Master insurance Policy?

All HOAs need insurance protection. The insurance provides liability coverage for the common areas. 

It also protects the board members and other officers from lawsuits.

Without HOA insurance, associations become financially responsible for medical bills, repairs, and lawsuits. 

Individual unit owners do not need their own HOA insurance coverage.  

Instead, residents in an HOA need typical homeowners insurance to cover their personal property inside of their units.

They also need liability insurance to cover injuries in their units. 

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What Insurance does a Homeowner's Association need? 

HOA insurance needs vary based on the association’s property and by-laws.

Insurance companies can customize policies based on the property, common areas, and board members. 

All HOAs need general property protection to insurance the shared properties and the. 

General property coverage protects the structures, but not the owners’ property in them.

It does cover the community-owned property like furnishing and appliances in a common clubhouse.

HOAs also need regular liability insurance to protect the people who visit the common areas. 

Most HOAs also need liability coverage for their board members who volunteer their time and make decisions about the property.

Other insurances HOA's may consider? 

HOAs might need insurance to cover common areas that host social events.

Some HOAs have clubhouses that host parties and events. If the HOA allows liquor consumption on the property, they also need liability insurance. 

Another consideration is garage-keeper’s coverage if visitors can park in a garage structure.

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This type of insurance protects the HOA from liability claims against the visitor’s car being stolen or damaged while in the parking garage. 

Two other insurance HOAs can consider include workers’ compensation and discrimination claims.

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Workers’ compensation insurance covers contractors who work on the common structures.

Discrimination claims insurance covers associations that can foreclose on residents who do not pay their mortgages. 

HOAs should also consider insurance that covers crime exposure from mishandled HOA funds and business auto exposure for employees and board members who use their vehicles to run errands for the HOA.

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How much does HOA Insurance Cost? 

HOA insurance coverage usually provides between $1 and $2 million worth of coverage.

The insurance rates usually run between $1,000 and $2,000 annually.

HOAs pay for that expense in the monthly dues they collect from unit owners.

Insurance agents can give quotes for an HOA’s unique insurance needs. 

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