HOA & Condo Disaster Claim Guide: Expert Advice for Recovery

Before a disaster, well-defined protocols should be set. This will guide your community. Assign specific roles and responsibilities to both the board members and management team. Focus on preventative maintenance, evacuation plans, and keep updated emergency contacts on hand. Review your insurance policies annually with your broker to ensure adequate coverages are in place.

Responding to a Disaster

During a disaster, focus on life safety first. For example, in the event of a fire, make sure emergency services are responding. This may include agencies such as the American Red Cross, which can assist with housing. After a disaster, swift action is critical in obtaining the best
outcome of an insurance claim.

Once the danger subsides and any safety concerns have been addressed:

1. Prevent Further Damage
   Insurance policies require insureds to prevent further damage where possible. Failure to do so could result in denial or limited coverage. For example, if a major pipe burst occurs, shut off the water supply and arrange to dry out the area.
   
   
2. Notify the Insurance Agent or Company
   Insurance claims should be reported in a timely manner with accurate information. Provide details including date, location of the loss, type of loss (Example: Flood or Fire), and information on the damages.
   
   
3. Obtain Estimates for Repair Work as Soon as Possible 
   Also, contact other appropriate professionals immediately after the loss. Remediation, repair, engineers, and attorneys are resources available for prompt and proper recovery.
   
   
4. Assist the Adjuster
   The insurance company will typically assign an adjuster within 48 hours to manage the claim. They will need to inspect the property and obtain photos of the damages, copies of the association’s bylaws, and the estimates for repair and remediation. Adjusters rely on the association’s responsiveness to appropriately address review. Therefore, timely contact between both parties is imperative.
   
   
5. Organize Invoices
   Once repairs are underway, confirm that invoices include clear descriptions as to the scope of work for each. Payments should not be made from the association’s general funds but from payments from the insurance company. It can be difficult to obtain additional documentation once vendors have received payment, and sometimes additional documentation is needed to close out the claim.
   
   
6. Consider a Public Adjuster
   In the event of severe claims, consider hiring a third-party public adjuster to help streamline the claims process and maximize coverages. You should always discuss this step with your agent or broker before signing a contract. You should be aware that once a public adjuster is contracted, your agent can no longer negotiate directly with the carrier on your behalf.
   
   
7. Communicate and Update Residents
   Disasters can be stressful and confusing situations for residents. Keep residents updated on safety protocols, recovery efforts, and any changes to the community the loss has created.
   
   
8. Future Prevention
   After the disaster, conduct a review of the association’s response and identify areas of improvement. 
   
   Handling disaster claims requires preparation, organization, and compassion from community associations. 
   
   By establishing clear protocols, communicating effectively, and diligently managing recovery efforts, associations can minimize disruption and support residents in repairing or rebuilding the community.