Finding the right insurance for a homeowners association building around Denver can feel pretty overwhelming right now. Premiums have been climbing rapidly over the last few years, mostly because the front range keeps getting hit with severe hail storms and unpredictable weather. While you cant change the weather, there are definitely some realistic steps a board can take to lower those monthly costs without leaving the community exposed to a huge special assessment later on.
Keeping Up With The Roof
A damaged roof is probably the single biggest threat to an HOA building insurance policy here in Colorado. Insurance carriers pay very close attention to the age and condition of a buildings roof when they calculate premiums. If an inspector sees missing shingles or deferred maintenance, they are going to charge more because the risk of water damage is much higher. Staying on top of regular inspections and fixing small issues fast shows the carrier that the property is well managed. Some carriers even offer a break on the premium if the association installs impact resistant roofing materials during a replacement.
Upgrading The Plumbing
Water damage claims actually cost carriers a fortune. A pipe bursting inside a multi unit building can wreck several units at once. Older buildings with aging plumbing are seen as high risk. If the association budgets for upgrading older pipes or installing automatic water shutoff valves, that directly reduces the chance of a catastrophic leak. Be sure to document these upgrades and give that paperwork to the insurance broker. They can use it to negotiate a better rate with the underwriter.
Taking On A Higher Deductible
One of the most straightforward ways to drop the premium is to simply carry a higher deductible on the master policy. If the HOA agrees to cover the first five or ten thousand dollars of a claim instead of just one thousand, the insurance company takes on less risk for minor incidents. This lowers the annual cost. Just make sure the association reserve fund actually has enough cash sitting there to cover that higher deductible if a massive storm rolls through.
Getting Rid Of Risky Amenities
Sometimes associations are paying to insure things they dont even really need or use anymore. If a community has an old playground that has seen better days or a hot tub that constantly needs repair, it might be worth removing them. These types of amenities carry high liability risks which drives up the cost of the policy. Removing an attractive nuisance that no one really uses is a quick way to shed some unnecessary premium weight.
Grouping Coverage Together
It sounds pretty basic but keeping all the coverage under one carrier often triggers a package discount. An HOA typically needs property coverage, general liability, and directors and officers insurance. Having the property with one company and the liability with another usually means missing out on some decent savings.