What this means for you as an owner:
As of 12:01 am, May 1, 2013, your home will no longer be insured by the HOA's insurer. You MUST obtain a standard homeowners policy to cover the structure of your residence. If you have a first mortgagee, you will receive a notice from them regarding insurance. In the past, many of you have contacted the management company to help with those certificates. WITH THE CHANGE IN COVERAGE, MANAGEMENT WILL NOT BE ABLE TO HELP WITH THESE CERTIFICATES THIS YEAR. You will need to contact your own insurance agent to provide that information.
As a gentle reminder, under Article 11 of the Declaration, in the event the HOA does not provide the blanket coverage (which will be the case after May 1, 2013), owners are required to maintain adequate insurance on their property.
What do you need to do next?
You should contact your current insurance agent as soon as possible for a quote for full coverage (normally called an HO-5 policy) on your house. This policy will replace the HO-6 policy you currently should have covering your personal contents.
You should watch your email for more information from the Board and management over the next few weeks. You will be notified in writing via regular mail in addition to email alerts. We intend to put up sandwich board signs reminding people of the change.
If you know of people that are out of town, or maybe don't have access to the email, and can contact them, please do so. A change of this magnitude cannot be overstated, in my opinion, as far as its importance. The last thing I want to have to face is an owner with an insurance loss on May 2, 2013 when no insurance is in place.
What's next from the HOA?
We still have to finalize the insurance for the common areas and insurance covering the Board and insuring the HOA's money. Once that is done, a new budget will be drafted, with the dues being reduced by the estimated amount of savings for insurance expense for the remainder of 2013.
We are contacting insurance agents known and recommended by Board members and management for possible presentations to owners at the April meeting.
As mentioned, we will be drafting a new budget, which will be sent to all owners and will require a budget meeting similar to the one we have every December.
We will not be issuing new coupons for those that use them (in order to save the additional cost); we are asking that owners simply note the new amount of dues and pay that amount (once you are notified of the new amount and effective date).
We will be inundating you with information and reminders about your need to add the insurance. Sorry for the intrusion, but we think it's critically important for the HOA and all owners.
What if this notice doesn't answer all my questions?
As usual, you know where to find me. (If not look for the phone number to the left side of this page .) I'll do my best to answer 'em all.
P.S. If you're curious about the primary reason for changing, this is what we were faced with: The claim for the hail damage last year amounted to approximately $525,000, of which $522,500 was covered by the policy. If we signed up for the policy being offered this year, the amount of the damage covered by the HOA's insurance would have been ZERO (had the damage occurred under the new policy) due to the recalculation and raising of deductibles. And the cost for that "coverage" would have doubled.