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 or not a suit has been filed. • Void exclusions found in the majority of commercial liability policies now in effect.