By Curtis G. Kimble.
It may be April Fools Day, but it’s no joke that every year around this time insurance companies see many flood issues and claims from homeowner associations. What’s worse, flood insurance is expensive and the typical HOA insurance policy does not provide coverage for flood and surface water claims. So, how do you protect yourself and your community? An HOA insurance specialist Béat Koszinowski of the Buckner Company shared some loss prevention tips with us that I’m passing along:
1. Problem: Irrigation system floods.
- Broken pipes, leaks and breaks that occur during the first few weeks of operation
- Malfunctioning or incorrect setting of the system causing overwatering
- General overwatering of certain areas or watering while the ground is still frozen (this can also cause slip and fall liability claims)
- Runoff due to changes in landscaping, etc.
Solution: Check the entire irrigation system thoroughly and inspect all areas where the sprinkler system operates at the start of the season and on a regular basis. Do not activate the system without checking it and making sure it operates properly. The average amount of this type of claim is between $15,000 and $25,000 and preventing this type of issue is a good investment in your property.
2. Problem: Landscaping, gutter and roof water runoff.
- Settling, sinking, expanding or shifting of the ground or landscaping features
- Ground cover or other landscaping features that are causing water to accumulate near the home and or penetrate the building envelope via the surface or below the ground.
- Water runoff near buildings that is not properly channeled away
Solution: Check the entire HOA grounds for problem areas and or hire a skilled contractor to check your landscaping, building envelope and other important areas. This helps to ensure your property and investment is protected.
Tip: Board members or homeowners should notify the manager or maintenance crew if they notice areas of concern. Don’t assume they know. It is important to understand that most insurance companies will not pay for damages that cause a claim due to wear and tear, rot, mold, latent defect, rust and corrosion, faulty workmanship, faulty design and inherent vice. Inherent vice means losses caused by a quality in a property that causes it to damage itself or destroy itself.
Hopefully, these tips will help keep this important issue in everyone’s mind at this time of year and will help avoid problems that are worse than any April Fools joke.