Condominium associations overlook the concealed risk of uninsured residents by not requiring liability insurance as a condition for community residency. Uninsured residents are not only a financial risk to condominium associations, they are a liability. Condominium association management teams work tirelessly to see that their residents have a safe, pleasant place to live. Market insurance conditions have led many condominium associations to assume significant amounts of risk in order to prudently manage insurance costs. Every year associations pay millions of dollars in unnecessary premiums due to accidents caused by negligence simply because owner/residents are not required to carry property liability insurance. Associations have several stated reasons for bearing the risk, including cost, convenience, market competition, and control. Condominium Legal Liability™ Insurance is the best product to address these concerns.

When condominium associations are forced to pay for owner/resident-caused damages due to FIRE, SMOKE, EXPLOSION, ACCIDENTAL WATER DISCHARGE and SEWER BACKUP, inevitably, the association's overall costs increase — and profits decrease. Condominium liability insurance transfers the liability for owner/resident-caused accidents from the association to the owner/resident.

Condominium associations can now rely on Condominium Legal Liability™ Insurance for a solution. Condominium Legal Liability™ Insurance protects the association from owner's/residents’ negligent acts — and at low cost. It is a convenient, focused solution that helps associations recoup costly losses.

Florida Condominium Legislative Changes

The 2008 Florida Legislative Session passed several bills which directly impact condominium associations.

• The legislation specifically requires individual unit owners to provide proof of hazard and liability insurance, special assessment coverage of $2000 and improvements and betterments.
• The condominium association must be listed as an additional named insured and loss payee on all casualty insurance policies issued.
• The statutes authorize condominium associations to notify owners of the new legislative requirements and to request proof that unit owners possess the appropriate coverage amounts.

Association Management Responsibilities

• Condominium associations and boards of directors are responsible to monitor the administration of these coverage requirements.
• Associations have a fiduciary responsibility to inform owners of these legislative changes, plus to present a proactive strategy to address these new regulations.
• The mandates require all association members to illustrate compliance of the new regulations.
• The statute authorizes the Association to acquire a policy at the expense of the unit owner, if the unit owner fails to provide a certificate of insurance for the appropriate coverage and policy limits.

Condominium Legal Liability Insurance Is The Solution

• CLL insurance provides a community-based insurance program which addresses the requirements of the legislation.
• CLL administers and monitors the entire process for associations and management companies as per the state mandates.
• The CLL policy is a master policy written for the condominium association.
• The CLL policy names the condominium association as primary insured; owners/residents are listed as insureds additional insureds.

CLL Adds Value to the Property Management Company and the Unit Owner

• There are no costs to the condominium association or management company.
• Participation in the CLL Insurance program is simple and enrollment is easy.
• All owners/residents are automatically approved without additional underwriting, once the association’s application is accepted.
• CLL transfers risk and financial exposure for condominium owner/resident-caused negligent actions and damages.

Three Components of the Florida CLL Policy

• Liabiltiy and Bodily Injury: Provides $100,000 or $500,000 of liability coverage for each unit based on association requirements. The policy provides liability limits paid directly to the condominium association due to unit owner negligence. Covered named perils include: fire, explosion, smoke, sewer backup and accidental water discharge. The policy includes $500,000 bodily injury coverage provided to unit owners for on premises liability in the unit owners demised premises.
• Special Assessment Coverage: $2,000 Condominium Loss Assessment Coverage per occurrence limit including Windstorm, Fire, Lighting, Hail, Explosion, Riot or Civil Commotion, Aircraft, Vehicles, Smoke, Vandalism or Malicious Mischief and Accidental Discharge of Water.
• Personal Property/ Improvements & Betterments: Named Peril contents coverage form excluding Wind and Wind-Driven Rain and Flood. Normal 17 perils covered (same as contents on HO-6 form). Excludes theft and includes burglary with signs of forced entry. Normal exclusions include: Flood, Earthquake, and, Terrorism, Radioactive Contamination, War, Electronic Data and Biological Materials.

The CLL Liability policy Covers Five Basic Perils

• Smoke
• Explosion
• Accidental discharge or overflow of water
• Accidental water back-up from a sewer, drain or sump pump
• Coverage of up to $100,000 ($500,000) per occurrence, subject to policy provisions
• Deductible per occurrence is $1,000
• $200,000 total aggregate limit per unit within a 12 month period

Benefits Payable under the CLL Policy

• First, to the condominium association for damages to covered property
• Second, to adjacent (non-negligent) owners/residents if the limit of insurance has not been exhausted Accidental discharge or overflow of water
• Third, to the negligent owner/resident for property, not to exceed $5,000 if the limit of insurance has not been exhausted
• Additional displacement/moving expenses up to $1,000 per unit

CLL Florida Program Administration

• The CLL Insurance monitoring, state-of-the-art database, and reporting systems manage the entire process.
• The program interfaces with most management software for a seamless, daily exchange of information on the community level.
• CLL Insurance provides site-level training and continuous administrative and technical support.
• Condominium owners and residents benefit from CLL Insurance’s convenience and easy enrollment process.
• The CLL Insurance program can also operate manually if internet accessibility is not available.

How to Apply For Coverage

• Complete the application; signature on page 3
• Provide the following by community:
  – # of units in the association
  – # of buildings containing condominium units per community