We had a great discussion at our HOA University in April. We discussed the new Utah laws governing insurance requirements and reserves. The new laws are summarized in the handout here: HOA University – April 2011 Handout, but the highlights of our discussion were:
1. condominium owners associations are required by a new law to insure all permanent improvements, including those that are within a unit,
2. for claims against the association’s master policy which are associated with a particular unit, the association can require that unit owner to pay the deductible if a notice is first sent to all unit owners stating they will be responsible for the deductible on the association’s master policy. Note that the unit owner can generally obtain insurance which will pay the association’s master policy deductible.
3. Utah now requires all homeowners associations to have property and liability insurance coverage for their common areas, (this was not required before in non-condominium HOAs, like single family home PUDs, or non-condo townhomes, but is now by this law),
4. all HOAs with attached housing (usually called townhomes) have the same requirements for insurance as condominiums (as mentioned above), unless the HOA was established before January 1, 2012, and the CC&Rs already require each lot owner to insure their own dwelling unit.
Curtis G. Kimble
Utah HOA Law Blog 
Is earthquake insurance required for the HOA? If earthquake insurance is not required, is the board required to look into earthquake insurance and make a written plan of how to pay for repairs if earthquake occurs- I read this somewhere. Can the board vote and decide on earthquake insurance or does it have to be homeowner majority? I looked into earthquake insurance and it only added $12 to each homeowners monthly premium. The homeowner majority was not aqcuired so no earthquake insurance. I have documents indicating that in other states, board members were sued because they did not have earthquake insurance and never investigated or had a committee investigate and report on earthquake insurance.
Earthquake insurance is so important to me and I am trying to learn about my options and the best way to tackle getting earthquake insurance . I am currently disseminating information on earthquakes and earthquake insurance to homeowners. Thank you!!
I have read the entire HOA university insurance requirements -April 2011 requirements and am still unclear on earthquake insurance. If anyone can enlighten me, I would really appreciate it.
Utah law does not require earthquake insurance in an HOA. The community association and condo insurance statutes do not address earthquake insurance and do not require a board to look into earthquake insurance and make a plan if an earthquake occurs.
The governing documents for an individual HOA or condo (e.g., CC&Rs and bylaws) may address earthquake insurance and whether such coverage is required or the vote needed to decide whether to have such coverage.
I have been trying to research insurance requirements of the homeowner, or usually referred to as an HO-6. I am not finding any law that requires an individual homeowner to have that insurance. Am I correct? However, can the Board include that requirement of each homeowner having at least enough insurance to cover the Master policy deductible?
New at this, and reviewing our CC&R’s which were originally filed in 2007 did require HO-6 insurance from each individual homeowner. There was an amendment filed in 6/2012 that deleted that requirement, understanding apparently that the Board could not enforce that requirement when there was not a law requiring it.
Can you help clarify?
1. Does the law require individual homeowners insurance in an HOA?
2. Can the CC&R’s be amended to require the coverage?
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Barbara Peterson
Thank you Barbara. Regarding your questions:
1. The law does not require individual homeowner insurance in an HOA. An HOA’s CC&Rs may require individual homeowner insurance, however.
2. Yes, the CC&Rs may require individual homeowner insurance (either originally or by an amendment).
Thanks for your clarification.
If we were to desire an overview of our CC&R’s and Bylaws, is that something you would provide? If so, approximate cost please, as we are a small HOA and limited resources.
Thanks again!
Barbara,
Yes, that is definitely something I provide. I will email you about it separately. Thanks.