Understanding Cross Condo Liability

A condominium can be a great place to live. The small community has a neighborhood type feel to it. It is usually considered a safe place for you or your family to spend their time. Many condos offer locked entries or even security professionals to protect the residents. Pools, fitness centers, community game nights, and having maintenance and yardwork taken care of can make it a fun place to live. But what happens when someone gets hurt or their property is damaged? While the master policy covers most liability, the most likely person to be hurt is someone who actually lives in the association. If a unit owner files for damages, things can get messy. This is where cross condo damages come into play.

What Is Cross Liability?

Cross liability is essentially when two parties who are insured under the same policy have a dispute and one wishes to sue the other. As related to condos, it provides protection when a unit owner or sues the association or another unit owner for damages due to negligence. For instance, if someone slips and falls on an icy walkway which is designated a common ground, they could potentially sue for negligence of maintenance resulting in the injury. Cross liability is one way to protect against this.

How Are Such Claims Determined?

Each condo association is governed by documents. Specifically, there are master polices, ownership agreements, bylaws, and declarations. These are the articles which are used to determine disputes within the association. In addition, each insurance policy is worded differently. Generally, the exact wording of the condo association’s governing bylaws and the specifics of the insurance policy are what determine what viable recourses are available to the injured party. These can be difficult situations because the nature of the claim does not fit cohesively into traditional insurance thinking.

Avoiding Cross Liability

To protect themselves from intramural suits, the condominium association should have a policy which contains specific cross-liability coverage. Since master policies normally do not cover liability concerning injuries occurring inside the units, it might be beneficial to purchase intra-unit liability coverage from the same carrier as the association coverage. This should help avoid litigation concerning the actual location of the injury.

Additionally, the board of managers should be doubly sure that they are personally covered for their actions in that capacity. Included in this coverage should be legal fees in litigation brought against the manager or board by any parties, including unit owners.

If you are interested in learning more about condo insurance for either the condo owner or the association, please contact the H&K Insurance Agency. We would love to review your policies, and provide you with an expert to help you understand the necessary coverage and policies for New England condos.