“ YOUR COMPONENT , YOUR PROBLEM … OR IS IT ?”
By : Brian Kalmenson , CIRMS Fire Damage
Why would damage from an owner ’ s icemaker supply line involve the association ’ s insurance ? Remember that where the loss started does not determine coverage , what caused the loss does . In this case , an icemaker supply line failure would fall into the category of “ sudden and accidental water discharge ,” which would be treated just like a sudden common area pipe break .
Another example is fire damage ; whether the fire starts from an owner ’ s stovetop or the common area electrical , fire is covered by insurance , regardless of where that fire started .
What came first , the chicken or the egg ?
While we can ’ t square that one away in this article , let ’ s instead tackle an issue that similarly stymies condominium association boards and managers alike , “ Why do we need to file an insurance claim when the loss originated from an owner ’ s failed component ?”
When it comes to property insurance , the most important thing to remember when ( not if ) this situation comes up is this : origin of loss does not matter . This is the major difference between maintenance and insurance .
CC & Rs typically make owners responsible for maintaining the unit interiors , meaning that if an owner ’ s ice maker supply line unexpectedly fails and causes interior damage , boards and managers may assume that this is not an association responsibility . From a maintenance perspective , this is correct , but it may become another story if the damages exceed the association ’ s property insurance deductible .
Now , does this mean that an owner ’ s insurance carrier is always right when they demand that the association open a claim for unit damages ? Far from it . This has become something of the default request from homeowners ’ insurance carriers , but there is a bit more to it , including :
24 | SAN DIEGO COMMUNITY INSIDER WINTER 2020