DEDUCTIBLE RESOLUTIONS
Deductible Resolutions :
Are You On The Hook ?
As most condo owners are aware , their condo associations are responsible for insuring the condo ’ s buildings , including the individual units , up to the original builder ’ s grade . Almost all condo association policies have property deductibles . If your condo association has recently passed a deductible resolution , you may now be on the hook for some , if not all of this deductible unless your current HO6 policy provides adequate coverage . Therefore , it is important that you contact your personal lines carrier or agent to establish how this loss is handled on your individual HO6 policies in order to be fully protected .
Ask your carrier or agent the following question : How much coverage do I have towards my condo association ’ s deductible ? If the amount of coverage is less than the deductible , find out how you can increase the coverage to the full amount of the deductible . Asking the following questions will aid you in this discussion :
1 ) Is the condo association deductible covered under the loss assessment portion of my HO6 endorsement ?
a ) If so , is it adequate enough to cover the full deductible ?
b ) If not , can I increase the loss assessment portion to the full amount of the condo association ’ s deductible ?
2 ) Is the condo association deductible covered under my HO6 policy ’ s Coverage A ( dwelling ), Coverage C ( contents ) or combination of the two ?
a ) If so , is it adequate enough to cover the full deductible ?
b ) If not , how much must I increase the coverage amount ( s ) to meet the full amount of the deductible ?
HO6 carriers are not uniform in their coverage of condo association deductibles , so this needs to be addressed with your individual carrier to protect you from significant loss . Consider how two personal lines companies that JGS works with on HO6 policies deal with this issue .
Travelers offers $ 1,000 toward the condo association deductible under the loss assessment portion of its HO6 policy . This amount can be increased up to $ 50,000 through higher premiums . Franklin Mutual Insurance ( FMI ), on the other hand , provides ten percent of the total Coverage A ( dwelling ) amount and the Coverage C ( contents ) amount towards the condo association deductible . For example , if your Coverage A and Coverage C amounts totaled $ 100,000 , FMI would provide $ 10,000 in coverage towards your condo association ’ s deductible .
Protection against a deductible resolution starts with telling your carrier or personal lines agent your condo association has adopted such a resolution and for what amount . Then , work with your carrier or agent to endorse the policy so it does provide coverage for the non-recoverable condo association deductible . Ask where this is addressed in the policy or have this coverage documented in writing .
Finally , most condo association governing documents and bylaws require that you have an HO6 policy with adequate coverage . Therefore , it is recommended that you have your carrier or agent send a copy of your certificate of insurance to your condo manager ’ s office to keep on file . +
BERNIE COSENTINO VICE PRESIDENT , JGS INSURANCE
Bernie Cosentino is celebrating his 33rd year in the insurance industry . Born , bred and educated in NJ he is a proud father to his adult children Joseph and Maria . Bernie is currently in his 17th year at JGS Insurance as A Vice President and broker / producer diligently pursuing the most competitive and comprehensive insurance program to a wide range of customer base .
6 | SPRING 2017