California’s homeowners associations must have a commercial HOA general liability insurance policy to protect the association from the liability exposure it faces on the regular. These exposures could include both injuries and accidents that happen in the HOA’s common areas. Incidents like a “slip and fall” on a wet side-walk, a broken foot from a pothole, and injuries on faulty playground equipment are NOT rare occurrences.
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General liability insurance for a homeowners association can cover many different types of claims, including property damage due to a negligent employee, bodily injury that was a result of using equipment in common areas, personal injury (example: defamation of character), and advertising injury (example: your association infringes on the copyright of another association). Although an HOA general liability insurance policy will cover the examples above, it will not cover a board member from actions they’ve made that damage the HOA or its other board members, this type of protection is offered under a HOA Directors and officers insurance policy.
General Liability For Homeowners Associations – It’s The Law
Laws in California state that homeowner associations are required to carry a certain level of general liability insurance depending on the amount of units the association has. For example: If a HOA has more than 100 additional interests, the minimum required amount of insurance is $2,000,000 in general liability per occurrence. Although this is the California minimum required amount, optional higher amounts may be selected, depending on the association requirements. Many associations carry an umbrella policy that requires higher general liability limits.
Claims made in court having to do with liability have no limit other than what is imposed by the judge in court. That being said, it’s very important that HOA board members consider the amount of risk their specific association carries. The risk can be higher depending on many factors that include the number of units, pools, playgrounds, gyms, hot tubs, ponds, and many other amenities the HOA may have on premises.
Get in touch with one of our agents and we’ll customize a HOA insurance policy that fits your specific needs. 949-777-5027.