Many condominium associations are governed by unpaid board members who have the authority to make decisions that impact an entire community. Some of those decisions are tough ones, and it is not unusual for a disgruntled resident to bring legal action against a board or board member. In the unhappy event of an adversarial lawsuit, it is important to know whether your condo association insurance policy provides comprehensive liability coverage.
Are You Covered?
Most condo association insurance policies are designed to protect the organization but do not extend coverage for unpaid employees. However, a condo association almost always bears ultimate financial responsibility for any individual acting on its behalf. That is why it is so important to carry directors & officers (D&O) liability insurance. D&O policies provide total security for board members, trustees, volunteers and committee members.
What Is Included?
Every individual who acts in any capacity on behalf of the association is protected against possible legal action. D&O policies provide compensation for insurable damages, legal fees, monetary claims and material claims. Some of the more common legal actions encountered by condo associations include claims of:
- Wrongful foreclosure
- Breach of contract or fiduciary duty
- Mishandling of community funds
Don’t take a chance with the financial health of your condo association. Read the fine print of your liability policy and learn more about the benefits of D&O Liability insurance.