Crime Insurance for Condo Associations

Condo Associations and similar HOAs (Home Owner Associations) are businesses. When they are founded, they need to file as a business, and therefore have the responsibility and risks that come with all businesses. Depending on the size of the condominium complex, or if additional units are added on later, this can be a big business with big responsibilities. A board of directors, employees, accountants, and staff, with a lot of funds passing through your condo association comes with risks. Crime insurance, also known as fidelity bond or commercial crime insurance, helps protect your association from employee dishonesty. Read on to learn more about how employee crime can affect your association, or contact H&K’s Condo Insurance Specialists now to get your suggested coverage.

Crime Insurance Is Fidelity Insurance

As mentioned above, crime insurance is inward facing. A common term for this insurance is a fidelity bond. This insurance protects the condo association from theft and embezzlement by employees and board members of the association’s funds. Sound unlikely? Here are a couple of cases in the recent years:

• Andrew Kissel, who embezzled $3.9 million while serving in a Manhattan condo association.
• Susan Marie Lambert & Michael Medeiros, who stole $2.8 million from San Mateo’s Woodlake Condo HOA.

Learn more about some of these crimes and more information about fidelity bonds can be found in our blog, Why Your Association Needs a Condo Fidelity Bond.

Amount of Insurance Coverage to Get

So, if you need coverage, how much should you get? The average minimum coverage should be equal to the amount of funds that are accessible to, or controlled by, the board. This means it’s important to consult with your accountants and get a clear picture of your finances. Often, it’s a good move to include an internal audit of your accounts when putting this coverage into place, not only to be assured of your accounts, but also make sure you’re free of pre-existing fraud.

When to Update Your Condo Crime Insurance

Since your coverage should be based on the amount of funds controlled by your association, your policy needs to be updated regularly with the proper coverage. On average, it’s a good idea to update this policy annually, or with events that significantly change your funds, such as increased fees or additional units added to the master policy.

Want to learn more about crime insurance for condo associations? Contact H&K Insurance. We can provide comprehensive and customized coverage for both the master policies of condo associations, as well as policies for individual unit owners for Massachusetts and the greater New England area. Visit our Condo Insurance page for more information, free online quotes, and to talk to our condo insurance specialists.