A condominium association must take steps to protect itself against common risks.


A condominium association plays an important role in the lives of residents. The volunteer boards strive to maintain a high quality of life for all residents along with the values of the properties. An active association performs important functions like setting bylaws for the community, collecting fees, managing routine maintenance tasks and mediating disagreements.

Along with all the work condo associations do for their communities come certain risks. It’s important for the members of the board to be aware of the problems and dangers they could face and make appropriate preparations. One of the most important precautions is doing your research before selecting the appropriate insurance policies to meet your association’s unique needs.

When you are aware of the greatest risks to your condo association, you can act to protect the investments you and your neighbors have made in your homes.

1. Property damage

“Unexpected damage to the property is always a concern.”

For any homeowner or renter, unexpected damage to the property is always a concern. The condo association is usually responsible for the maintenance and repair of all common areas, so it’s essential to have coverage in place in case of an accident, fire or equipment failure. Depending on the location of the condos, the association may have to consider purchasing supplemental coverage for natural dangers like flood, wind or hail.

2. Injuries

If someone is hurt in common areas around the condos, that might be a major liability issue for the association. Legal settlements for these kinds of cases can be massive and even groundless complaints are often costly, so obtaining umbrella coverage for the association is a prudent move. In such a situation, it might also prove vital to have safeguards in place for the directors and officers, since they could be held responsible for the situation that led to an injury.

If someone is injured on common property, it can be a big problem for the condo association.If someone is injured on common property, it can be a big problem for the condo association.

3. Crime

A condo association is about cooperating with your neighbors to build a better community for all the residents. However, there is always the possibility of someone abusing that trust. Every community has its problems with stolen money or property, vandalism, fraud and other criminal activity, and condo associations can be particularly vulnerable targets.

An association board should always be alert to the possibility of theft committed by a dishonest employee or a robbery or burglary on the premises. Other dangers can include fraud or misappropriations of funds committed by a manager or the directors and officers on the board itself. Careful monitoring of assets, background checks for workers, sharing responsibility for depositing funds and taking out an insurance policy are all vital steps for fending off devastating financial losses.

Condominium associations must take into account a wide range of risks when choosing insurance policies. It’s vital to perform extensive research and plan ahead for the dangers that are most pressing for the specific property and region. Teaming up with partner that specializes in helping community associations find exactly the right insurance for their needs can go a long way to providing all residents with peace of mind.

McGowan Program Administrators offer a variety of options that allow a condo association to find the perfect coverage, including Community Association Package Insurance, Umbrella Insurance, Crime Insurance and Directors and Officers Insurance. “The Power of the Pen” means you can bundle together the protection that suits your community’s unique needs. There will always be risks to your home, but working with experts to find the best policies means a board is protecting its interests and fulfilling its responsibilities.

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