For co-ops, condos, and HOAs, insurance premiums are some of those quiet necessities that tend to fly under the budgetary radar until it is time to examine the bottom line, provoking a search for savings.
Without a doubt, insurance expenses can be significant. Fortunately, examining risk and liability can bring those costs down…and keep them down. Certainly, this process requires a time commitment from board members, managers, residents, and insurers; in the end, however, reducing risk not only saves on premiums, but helps to make the community a safer, more efficient place to live, as well.
Taking Those First Steps
Often—too often, in fact—issues of liability and risk are examined only after problems have occurred. Usually, insurance holders address matters “because something bad has happened,” says Robert M. Prince, a partner at the law firm of Chatt & Prince P.C., based in Hinsdale. “Someone has been hurt or a lawsuit filed…it’s more reactive in nature. Other times, a new case or law comes out and that prompts boards and managers to look at how they’re doing things,” he says.
Though, these days, “Associations are doing more with less money,” says Prince. “They want to pay less to insurers or attorneys, and they’re being more proactive about costs.”
Thankfully, a number of options exist to reduce risks that elevate insurance costs. One of the first steps to take in making these assessments is to talk to the insurance agent, says Michael Conte of Ron Tepperman, Inc., an insurance company based in New York City.