Weathering the storm: a Top 10 list for condo and HOA boards

BY DONNA DIMAGGIO BERGER SPECIAL TO THE MIAMI HERALD

Storm season is stressful for all Floridians, but for condo and homeowner association volunteer board members, the stakes are higher. These folks are expected to safeguard common areas, account for vulnerable residents and recover funds for all insured losses.

Here is my Top 10 “to do” list for your community:

1. Review your insurance coverage, exclusions and how your deductible works. Confirm whether deductibles are on a per building basis. Do you have law & ordinance coverage that allows you to rebuild pursuant to the current building code? Must you make repairs first and then seek reimbursement from your insurance company afterwards?

Make copies of all your policies and store them in the Cloud for easy retrieval. Ideally, every owner would have interior coverage —an HO-6 policy insures the unit’s interior contents, fixtures and furnishings.

2. Date-stamp photographs and video of your property — best preferably before June 1 — and safeguard that photographic evidence. The association’s insurance company will demand proof that the damage was caused by the most recent storm and was not pre-existing damage or lack of maintenance. Without this proof, your association’s insurance claim can be denied or underpaid.

3. Negotiate ahead of time with vendors including your landscaper, management company and security personnel to clarify what services will be provided in advance of and in the immediate aftermath of a storm as well as what prices you will pay for same.

4. Make sure you have updated contact information for all residents and board members, including emergency contacts. In multifamily buildings, identify which owners have medical conditions that are dependent on access to electricity and ensure that your generator is filled and functioning.

5. Make sure all summer construction projects address the contractor’s obligations in the event a storm watch is issued. Adopt rules that require all construction materials to be secured and waste receptacles covered or emptied prior to a storm.

6. Pass rules that require owners to remove all items from the balconies or patios and close hurricane shutters. Out-of-state owners should provide the association with keys to the unit and identify a local caretaker to contact if storm preparations are incomplete for the unit.

7. Are your finances in order well before the storm approaches? Do you have fully funded reserves or a line of credit in place that can be used to pay for uninsured losses? If you require dual signatures on checks and your credit card has a low limit, make arrangements as to how immediate repairs will be paid.

8. If your community suffers storm damage, you can be sure that you will be visited by a number of public adjusters and contractors seeking your business. Your immediate need is to safeguard your property from additional damage. That typically means placing a tarp over the damaged or missing roof and drying out the water-damaged units and common areas.

Do not sign multi-million-dollar repair contracts and/or contracts that require your board to assign your insurance benefits to a contractor. Your obligation to undertake due diligence does not vanish in the aftermath of a disaster. Major repairs must be carefully planned and executed, just like any other major repair project.

9. You need experts to determine the extent of the damage you’ve suffered. They are your board’s safety net when you are criticized (and you will be criticized by some members) for the type of insurance claim you’ve filed and the scope and speed with which the repairs are made.

10. Manage residents’ expectations to avoid confusion and complaints. Advise your members when security and management personnel will be leaving in advance of a storm and when they are expected to return. Advise that all essential building services including water and electricity will be shut down if the community is put under a mandatory evacuation order. Further advise that if the building sustains direct damage, residents may not be permitted to return to their units until a building official gives the OK to do so.

Following these 10 steps will give your community the best chance of weathering any storm!