Question:
A year ago this past June, the Board President decided to file an “emergency” claim with the HOA’s master policy insurer for hail damage to two or three units. However, all 27 units did not suffer damage. The claim was for approximately $750,000. As a result, no other insurer would insure our subdivision (mostly elderly, over 65 years of age). Assessments to these retired folks were about $5000 per person to get these new roofs. (The Presidents main goal and what she ran on was to try and find a way to get new roofs). Now, a year later, we found out through contractors that the roofs were not put on correctly, the vents were not placed with the right nails, leaks were found, etc. The HOA refuses to file any claim, refuses to hear from its “problem residents” complaining about the roofs, and in the meantime, we have roofs not ventilating properly, mold is growing, the internal temps are reaching 140-150, and other major issues are occurring. The HOA stated in December 2023 that they refuse to file any claim for five years since no other insurance company will touch our HOA. So, we’re all paying about $1000 extra per year for no coverage. We are not allowed to insure our total structure, only have an HO6 policy. What to do about the roofing situation? The insurance situation? We don’t know where to turn. The only thing that we are told by the HOA is “Well, what are you gonna do? Nothing.” Please help!
– Christopher
Answer:
Hi Christopher,
You may speak to the HOA manager a lawyer who is familiar with HOA insurance to find alternative options regarding the insurance. They may know of potential alternative insurance providers that can help. However, if insurance seems unattainable, the community may consider alternative funding by availing of a loan or using the reserve funds. Unfortunately, if there are no other methods, special assessments may be the only option for the community.
Regardless, the association has a fiduciary responsibility to put the community’s best interests first. It also has maintenance obligations as provided for in the governing documents. You may review the governing documents to find the details of the association’s maintenance responsibilities. You may raise this with the board so they can work together with the contractors and insurance providers to fix the roof.
However, if the board refuses to cooperate, you may opt to resolve the conflict through alternative dispute resolution such as mediation or arbitration. Alternatively, you may opt to remove the problem board member(s) according to the provisions of the governing documents. For further guidance, kindly consult a lawyer.
Disclaimer: We are not lawyers. The information provided on this website does not constitute legal advice.
