Complacency. You put your insurance premiums on auto-pay and everything’s taken care of.
Or so you think.
Earlier this year when I found out AAA was no longer writing policies in the Tahoe basin I finally took a good look at our condo owners insurance to start shopping around.
$24,889
That was our dwelling coverage!
If our unit was destroyed in a fire, the HOA’s policy would rebuild it to its 1973 condition.
Not only does that mean the bare minimum for counters, cabinets, appliances and fixtures– NONE of the units came with finished basements!
We recently spent close to $24,889 just for new flooring.
The Caldor Fire, which for a time threatened South Lake Tahoe, caused many of us to question the adequacy of our insurance at Incline Pines– and not just our individual policies.
Incline Pines HOA insurance
The HOA’s insurance agent, Ron Wright, joined us for an hour-long Zoom Q&A session on Tuesday (Nov. 2) regarding the association’s current coverage with Community Association Underwriters (CAU).
Here are the highlights:
- CAU estimates the cost to rebuild ALL 40 units at Incline Pines to be $28,267,750 ($280/sf)
- CAU guarantees replacement cost to original condition with “like quality” materials and a total of $4.75 million available for the entire community to bring units up to current code
- Individual owners would be responsible for upgrades, improvements, alterations and additions
- $1 million in coverage for demolition costs for the entire community
- No coverage for asbestos or mold abatement (drywall contained asbestos into the 1980s)
- $10,000 deductible for a fire– whether that’s one unit or all 40
- $5 million liability coverage
- Owners must carry adequate liability insurance for their own improvements outside the units, i.e. hot tubs and other items not added/installed by the HOA
‘All-in’ coverage
What if the HOA’s policy covered everyone’s unit, including upgrades and alterations? It could, and it’s called “all-in” or “all-inclusive” coverage. Fred Stahl (Unit 34) suggested there might be economy of scale if the HOA acquired all-in coverage, thus allowing individual owners to reduce the limits on their condo owners policies.
Update: Ron checked with CAU on Wednesday (Nov. 3). He’s says there’s a moratorium because of the wildfires this summer and the company will not currently allow any property coverage increases.
What to do in the meantime
While we explore and discuss all-in coverage, PLEASE take a look at your current condo owners coverage!
I just moved to State Farm with a $200,000 dwelling limit, up from 25 grand with AAA. Fred said he’s got $300,000 in dwelling coverage, Heidi Burton (Unit 17) has $500,000 and Carole Dolan (Unit 24) has $600,000 in coverage. Take a hard look at what replacement of your unit would cost in today’s dollars and decide what it will take to help you sleep better.
Thank you to all of you who attended the meeting.
We are just beginning the process of figuring out what we are covered for and what homeowners need to do to make sure they are covered. Every homeowner needs to take on the responsibility of making sure they are insured to their own comfort level.
We will keep you informed of any updated info. we receive.
Thank you Fred and Carole D. for pushing for this meeting and information.
While my individual unit coverage is $300k, I had no idea before this year that the coverage was to 1973 original condition. I will be increasing my coverage substantially and i will also make sure that my individual coverage dovetails with the HOA coverage. While Ron indicated that the decks are covered by the HOA, there was a change to the HOA documents that shifts the decks to us personally, I am not sure yet who’s insurance would really cover this item. I think this needs to be hammered out by each unit owner with their individual homeowner insurance company. I am making a list of everything that I want the insurance company to tell me that they are covering. I am also taking video of my interior so that if there is a claim I have a record of what is in my unit.
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