Are you a unit-owner in a Condominium Association here in Park City? If so, there have been recent State Law updates that impact you.
In July of 2011, the State of Utah Legislature enacted a new law titled: “The Community Association Act”. This act significantly changes the responsibility of the Condominium Association as well as the individual unit owners by requiring the association to seek out an insurer that will insure “every single unit in the project, including building coverage at 100% full replacement cost”. Utah SB167
In other words, the association mater policy will be considered primary.
However, the unit-owner will be responsible for the portion of a loss that is attributable to the association policy deductible. This is very important to be aware of because the association may have chosen a primary policy that has a large deductible, say $50,000.00 for example. The unit-owner is responsible for that deductible amount and can obtain insurance coverage for that exposure or simply chose to self-insure and retain the risk.
Additionally, the association master policy only provides liability coverage and building coverage to the association. It does not provide coverage for the unit-owners
-Personal Liability
-Personal Belongings
This is why it is so important to work with a local insurance professional that knows this law. Buying the right policy that conforms to the new statute and also adequately covers a unit-owner is crucial and can save you significantly in case of a loss. It can also likely save you premium dollar expense as the standard policy for unit-owners is much less expensive than before the law was enacted.
This law is very unique to Utah and many are still unaware of its existence. Especially those moving here from out of state or buying second homes. Reaching out to your current insurance agent to review your coverage’s and make sure you are adequately protected is recommended for peace of mind. If you are not getting the answers you need, reach out to any of our terrific local insurance agents for advice.
Written By Justin Englebright
Justin is a local Park City State Farm agent who has 20 years’ experience here in the Utah Market. He prides himself of educating his clients and helping them get the most for their premium dollars.
Please consult with your insurance agent, CPA, and attorney to confirm all information based on your personal needs and situation. For a copy of the complete Condominium Association Act guidelines, please email me at info@hongmcdonald.com
