CAI Insurance 101 Presented by: Douglas Benson, Esquire Benson PC - - PowerPoint PPT Presentation

CAI Insurance 101

Presented by: Douglas Benson, Esquire Benson PC Makey Towne, CIC, CRM Moody Insurance Agency

War Story - Drowning

War Story - Fire

War Story-Hail

War Story - Daycare

War Story - Crime

War Story – Workers Compensation

Basic Insurance Program

• Commercial Package Policy

– A “Package” of insurance including Property & General Liability and other coverage

• Directors & Officer Liability
• Crime (Employee/Volunteer Dishonesty)
• Owned/Non Owned & Hired Automobile Liability
• Excess/Umbrella Liability
• Workers’ Compensation

General Liability

Description: Protects against the legal liability arising from bodily injury or property damage to third parties.

Slip and Falls, Playground Injuries, Hired & Non Owned Auto Liability

• Occurrence vs Claims Made
• $2,000,000 General Aggregate
• $2,000,000 Products & Completed Operations Aggregate
• $1,000,000 Each Occurrence
• $1,000,000 Personal and Advertising Injury
• $5,000 Medical Payment
• $1,000,000 Hired & Non Owned Automobile Liability

Property Coverage

Direct Damage to Buildings, Business Personal Property, Computers, Fences, and other Property owned by or responsibility of Association.

• Association Declarations

– Legal versus Insurance Language – Condo/Lot/Unit Definition (Studs In/Studs Out) – Common Property/Elements Definition – Association Insurance Requirements – Waiver of Subrogation/Hold Harmless

• Special Form (All Risk)

– All Risk subject to exclusions – Standard Deductible – Who Pays/Assessments? – Wind & Hail Deductibles – 1% – Ordinance or Law – Boiler & Machinery/Equipment Breakdown – Flood & Earthquake

Crime

• Employee Dishonesty/Fidelity Coverage

– Policy which reimburses association for losses resulting from dishonest acts of employees, board members, volunteers, property manager. – Required by most lenders (FHA). – Required by most association declarations.

Directors & Officers Liability

• Liability Incurred by Directors or officers due to

acts that result in financial loss to association members or outside persons.

• Manuscript Policies

– No two are the same

• Board of Directors
• Volunteers & Committee Members
• Can Protect Developer
• Discrimination/Emotional Distress

Excess Liability (Umbrella)

• Covering claims that exceed the original

liability limit.

• In Excess of:

– General Liability – Automobile Liability – Employers Liability – In some cases Directors & Officers Liability – Does not apply to Property Coverage

Workers’Compensation

• Required by State Law
• Issues

– Definition of Employee – Owner/Officer can Exclude themselves – 1099 – Independent Contractor – IRS v. Workers Compensation

State of the Market

• Soft Market through 2011.

– 3% – 5% Increases on Renewal – Aggressive Pricing on New

• Increased Deductibles for Hail resulting

from storm of July 20, 2009.

Emerging Trends

• Green especially Solar Panels
• FHA and Other Bank Guidelines
• Foreclosures
• Increased Scrutiny of Certificates of

Insurance.

• Unit/Home Owner Insurance (HO-6)

Emerging Trends (Cont.)

• HB-1394 Has Passed CO House & Senate:
• Require insurance companies to cover the

workmanship of contractors they

• insure. (Workmanship has never been covered,

and no other state has this requirement.)

• Require a duty to defend regardless of whether
• r not a suit has been filed.
• Void exclusions found in the majority of

commercial liability policies now in effect.