By: Harris B. Katz, Esq. Special to the Boca and Delray newspapers
Q: I am on my association Board. Do you have any recommendations for what we should do as a Board now that it is hurricane season?
R.B., Boca Raton
A: It is hard to believe that another year has gone by since last hurricane season! As the entire state of Florida learned in 2017, we need to be cognizant of the very real potential threat of hurricanes. Whether you are a board member for a homeowners association (HOA) or a condominium, you have a responsibility to make sure that there are proper plans in place should we face another Hurricane Irma this year.
First, this is a great time to review your association’s property insurance policy. Specifically, pay close attention to your hurricane deductible. In exchange for lower premiums, many associations (and homeowners, for that matter) will opt for a much higher deductible which needs to be met before insurance kicks in. After Irma, there were many, many associations that suffered tremendous damage in the hundreds of thousands of dollars, only to find out that their hurricane deductible was a million dollars or more! This can be devastating to the finances of an association and its members, more than washing away any money that you saved on your insurance premiums on the front end. Therefore, it is a good time to meet with your insurance broker or agent now to go through your deductible and coverage to make sure that you have the best policy in place should we face another bad hurricane season. Remember, if the board is going to consider a lower premium to save money now but your association does not have the total amount of the deductible available in excess operating cash or reserve funds, it is important that you discuss how you will pay the deductible in the event our area is hit with a damaging hurricane.
Other than insurance, there are many other things that you can do in preparation for hurricane season that go far beyond what we can include in this short response, but one of the most important things that you can do as an association, is work with your property manager to create a disaster plan to map out a plan of action in the event we are unlucky this year. Also, create a record of the current condition of the property by photographing all the public and common areas of the condominium property. These images could become vitally important should you need to file an insurance claim due to hurricane damage. Speaking of property damage, during a hurricane everything becomes a potential hazard due to the high winds. This includes landscaping. It is a great idea to trim your trees at the beginning of summer and not wait until a storm is on a direct path to South Florida.
One of the unique things about living in Florida is the number of snowbirds that go back north over the summer, leaving their units unoccupied. Because of this, your hurricane preparation policy should include having those snowbirds move all outside furniture inside before leaving for the summer. On that note, be sure that you have updated contact information for all of those persons going out of town for the summer so that you can reach them should an emergency arise, including cell phone numbers. You should also remind owners about the importance of maintaining their own homeowner’s insurance policies to cover their personal property within their units and their limited common elements. One final thing that you should strongly consider is that if you are aware of leaks around the property involving common elements such as roofs or windows, have those items repaired immediately, before we get deeper into the rainy season. Existing damage to common element items that are aggravated during a storm could increase repair costs and the association’s potential liability to the owners, as well as potentially impacting insurance coverage. This repair work could also include trimming back trees and vegetation and having all windows inspected prior to a storm to identify and repair any weaknesses in the frames, seals, caulking or windows themselves. These steps will help to prevent an otherwise unavoidable disaster.
Finally, after Hurricane Irma, if you did have to make an insurance claim, many property owners learned that insurance companies are in the business of saving money, not in paying out claims. As a general statement, when an insurance company sends an adjuster out to your property, they try to resolve claims for the smallest amount possible or deny them outright based upon exclusions in the insurance policy. However, just because your claim was denied or was determined to be below your deductible, it does not mean that the insurance company was correct in its assessment or that it fairly evaluated your loss. Remember that an insurance policy is nothing more than a contract between you and your insurance company. That contract has language in it that provides for coverage of certain losses, provided that the claim does not fall under one of the many exclusions in the policy. The problem for non-lawyers is that the language contained in those policies can be confusing and convoluted so that when an insurance company makes its final determination, they rely on most people to simply accept that decision without further argument. It is best practice to have your association attorney in the loop immediately following a storm so that he or she can make sure that your rights under the policy are protected from the get-go.
Harris B. Katz, Esq., is Partner of the Law Firm Goede, Adamczyk, DeBoest & Cross, PLLC. Visit www.gadclaw.com or to ask questions about your issues for future columns, send your inquiry to: firstname.lastname@example.org. The information provided herein is for informational purposes only and should not be construed as legal advice. The publication of this article does not create an attorney-client relationship between the reader and Goede, Adamczyk, DeBoest & Cross, PLLC. or any of our attorneys. Readers should not act or refrain from acting based upon the information contained in this article without first contacting an attorney, if you have questions about any of the issues raised herein. The hiring of an attorney is a decision that should not be based solely on advertisements or this column.