•
•
Bodily injury example: Homeowner Henry slips
and falls on lifted sidewalk in the common area,
after which he alleges that the association hasn’t
properly maintained the walkways.
Third-party property damage example: Silly Sally’s
home is damaged from a misdirected common
area landscape sprinkler, and she alleges that the
association’s negligent inactions have led to her
interior damages.
While many times a complaint such as the above
may appear nonsensical to some boards, it is important
to know that the association’s GL policy almost certainly
has language specifying that the carrier should be notified,
“…as soon as practicable…” following knowledge of a
potential issue. That means if you receive an allegation that
the association’s actions/inactions have led to bodily injury
or property damage, it’s time to let your insurer know.
Directors & Officers Liability, or “D&O”, coverage
is what provides protection for the board members,
committee members, management, employees, volunteers
and a host of others for allegations of “wrongful acts”. What
is a “wrongful act”, you might ask? Common examples
include discrimination, breach of contract, breach of
fiduciary duty, and other similar types of complaints.
The common thread of D&O policies is that they
will typically define a “Claim” as a written demand for
monetary or non-monetary damages, as well as the
commencement of civil, criminal or administrative
proceedings. In short, if it’s in writing, you’ll want to send
it to your insurance provider. If it’s something received
only verbally, while it may not qualify as a “Claim” on the
policy, it couldn’t hurt to let your
insurance broker know and they
can guide accordingly.
Proper notification,
particularly on the D&O policy,
is unspeakably important. The
number one reason for a D&O
claim to be denied in California
is due to the association not
having notified the carrier in a
timely manner once the policy’s
definition of a “Claim” has been
met. Every situation is unique and
different, so don’t hesitate to give
your insurance provider a call as
situations arise.
Brian Kalmenson, CIRMS,
is a Commercial Insurance
Specialist with the Kirk
Miller Insurance Agency,
which specializes in
providing insurance
services for community
associations through
California. Brian can be
reached at 619.255.9433,
or via email at brian@
kirkmillerinsurance.com
Community Legal Advisors Inc.
COMMUNITY ASSOCIATION ATTORNEYS
Serving San Diego County,
Orange County, Inland Empire
and Coachella Valley
Toll Free
833.938.1877
AttorneyforHOA.com
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