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If you or your board has ever wondered about HOA insurance and if your community needs it, the answer is YES! All you need is one accident and your community can be involved in expensive litigation, which can cost thousands. A proper insurance policy will protect your community, while helping mitigate expensive legal troubles down the road.

Let’s take a look at the most common types of association insurance.

Liability Insurance

Although your association should take measures to prevent safety issues, accidents happen and a liability policy will cover any accidents or injuries on association property.

Property Insurance

Since every HOA has property, like landscaped common areas or structures, every HOA should carry property insurance to protect its investment. Your community will need property insurance to recover from vandalism, or damages caused by fire or natural disasters.

Directors and Officers Liability Insurance

More commonly known as D&O coverage, this insurance protects board members and trustees when they make mistakes without malice. This is important coverage, especially if you want your board to function at its best (and not worry about liability).

Worker’s Compensation

Although not strictly necessary, your board should consider having worker’s compensation insurance to cover volunteer board members who take time to do small tasks for the association. This insurance does not replace the worker’s compensation insurance that any contractors you hire should carry.

Fidelity Insurance

Fidelity insurance should be part of your insurance coverage as it protects your association from theft committed by employees, board members, contractors, or even property management companies.

Remember, every association is different, and will need slightly different types of insurance. It is important that you contact an agent who specializes in HOA insurance to make sure your policy provides adequate coverage for your community.