05.05.2023 | Webcasts & Podcasts

The Marcus Hour | Ep. 4 | 5.5.23 | What Managers Need to Know About Condominium Insurance with Guest Speaker Thomas Shields of Brown & Brown Insurance

The Marcus Hour | Ep. 4 | 5.5.23 | What Managers Need to Know About Condominium Insurance with Guest Speaker Thomas Shields of Brown & Brown Insurance


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Our special guest, speaker, we’re really excited to have Thomas Shields.

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Thank you, Jake.

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Today, we’re we’re gonna get into insurance, a topic that you know, boards and managers.

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It’s important to know, but maybe not.

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Maybe not have the most well known, recent, or everything you need to know about insurance.

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So we’re really gonna get it into that today. It’s a critical topic to understand.

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As I mentioned, and really just navigating insurance for Condominium and community association.

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So today, we’re good. Yeah, we’re gonna get to directors and officers insurance, general liability insurance crime, even crimes and devastating losses.

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We’re going to talk about Surfside a bit.

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That was the building. Collapse down here in Florida.

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We’re gonna get to a double homicide murder in a cell.

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Boston, which also resulted in some insurance issues.

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So, you know insurance may be a topic that people try to avoid and kind of stay away from.

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But it’s important to understand and that’s kind of segue into our guest speaker today.

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Who is Thomas Shields. Thomas Shields.

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He was a college offense of lineman. I think.

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Oh, God!

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What? What if you? I don’t know how many football fans we have?

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I’m out there. But when you think of football offensive lineman is not the.

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It’s not the most exciting position if you want to be the wide receiver coordinator, back or defense quarterback, but it’s all built in the trenches, and that’s where it’s starts. And that’s kind of like insurance and tommy

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he’s the expert on insurance. He has 20 years experience.

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Vp, give business development, app round of assurance, which is one of the largest insurance brokers in the world, if not the largest, and they have access to you.

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Name it pretty much. Every care you can think of.

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He specializes in particular and community association work.

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And he’s also also doubles in a blockchain.

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Yes, yes, it’s a.

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So if you have any questions on Blockchain, he’ll be heading to a conference.

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I believe in Florida next month. Is that right? Right, Tom?

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Yeah, yeah, we’re gonna go down on the sun. We’re gonna talk about the wonderful world of blockchain and crypto.

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Yeah, okay, that’s all. That’s.

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So, it’s developing as we speak. Everybody here is voted.

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Everybody knows about it a different way of looking at things. You know, Jake, thank you for the wonderful introduction, and aside from that, I humbled and appreciative of you guys inviting me on.

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And you know I’m looking forward to discussing some really unique topics that I think if you take your time and you look at this and you say, Hey, you know, like you take 2 or 3 things away from it, it’s gonna be a valuable session for everybody.

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That that’s attending. So, thanks again, I appreciate it.

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Thank you, Tom. And yeah, we appreciate having you on. And yeah, yeah, Tom hits it on the head.

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There. It’s a topic that people stray away from, you know.

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People don’t want to pay attention to the offense alignment, but they’re important.

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You pay a little attached to them, you know. That’s gonna be what gets you that super bowl?

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So this is gonna make. This is gonna pay dividends in the end.

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And this is important. Tom’s apart to see. I, New England Community Association Institute, and also, as I mentioned, Brown and Brown, headquartered right and a lot a lot of community association work you can do here.

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They also have offices in Daytona Beach, Florida.

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So really, they start the whole country. And I believe, internationally as well.

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Right, Tom.

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Yeah, yeah, we there was actually perfect of a London broker recently.

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So they’re very excited about that it’s in the end.

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It’s nice to be a part of such a large organization, because you do have a lot of opportunities.

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But we’re headquartered in Denmin.

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I gotta tell you it’s all local people.

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I grew up in Winchester. You know this is all you know.

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It’s a local organization. We get some really good horsecar behind us because of the name and opportunities behind us.

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So it’s it’s the best of both worlds. I think.

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Absolutely. Yeah, brown and Brown is the name, and Tom Shield is the X Ray.

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So we’re happy to have him and his brand behind us today.

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So also, and we don’t wanna leave out our co-host as well.

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Steven, Marcus, as we kind of jump into the weeds of this present Stephen, Marcus, he’ll be just jumping in with property managers, because that’s gonna be an important topic that that we kind of address property managers and

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boy or trustees, what do property managers do?

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What do trustees or board members do? So I’ll hand it off to Steven to get us into kind of protection for management companies and what what they can kind of do in in this in this realm?

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Thank you, Jake. If if there’s ever gonna be a disaster with a condominium in terms of managers and board members, it’s going to relate to a insurance, and unfortunately we had surfside and the tragic murder of the 2 surgeons and their

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penthouse Condominium unit in South Boston, as evidence of that.

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But we’re gonna start with homework grab a pen or a keyboard, and I’m gonna go quickly on the but post program.

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We’re gonna send out the Powerpoint, and we can add these 7 bullet ids.

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Here’s what we want you to do. After hearing this this program, one get and then share this this program. One, get an insurance reconstruction appraisal for your company.

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The amounts that are stated in the policy do not necessarily reflect the real cost.

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We’ll get into that more but that’s item one on yet to do us to get a code expert and have somebody who can.

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An engineer who can estimate the cost for bringing the building up to current ordinance or laws.

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If a building goes down by a certain percentage, it has to meet new code 3 heavier and insurance reviewed by an attorney who can look at the Condominium documents, knows the Mass Massachusetts Condominium Act and who knows the

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feminine May Friday, Mac. Requirements, and may have other practical advice as well as speak to your insurance professional, and please pick one such as Tom for of 5 to 6, in my opinion, in the state or in the region who really know condominium insurance.

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and that’s it’s critical to make sure that the insurance is adequate.

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Get a premises. Liability audit. So Tom’s gonna be speaking about these security security issues in the South Boston case and where the amount of the claims could be in the tens of millions millions of dollars against the Association and security company there are companies such as liability consultants that

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do, premise liability audits, and at least it ships the the liability away from the Association and and the manager.

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If it does what the audits says increase limits of Dno, and the comprehensive General Commercial General liability, and the umbrellas.

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Tom will speak on that. But stop thinking about a million dollars doesn’t cut it anymore.

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5 million. 10 million. 25 million. 50 million. 75 million.

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How much can you get sued for and how much can you afford?

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It’s critical to have right amounts for 2023.

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Managers should have their management agreement reviewed by their own lawyer, not the Condominium Association lawyers, but by their own lawyers, and sit down with the your insurance professionals to see what the managers should have book coverages and to see what’s they’re

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covered for under the Condominium Associations, policy, and 7 is using agent who knows?

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Condominiums. As they said, they’re a 5 to 6 or 7 who are very, very good.

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The cost is the same, the commission is the same, but they may suggest coverages that others who don’t do this 60 h a week down, and on management companies normally on an insurance seminar I we don’t think of the manager.

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But in preparing for this I thought of the general issues that relate to the management company, and that we should spend 5 or 6 min on risk management, that the manager should take because the you do have potential vulnerabilities so the first one is have their own legal counsel

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regime, the defense and indemnification, provisions of the management, agreement, and the exclusions of the master policy.

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A surfside is how Boston claim could be devastating try to ship the liability and negotiate for mold and security from the Management Company to the Association.

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It’s if you can. Mold is typically excluded.

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A hundred percent from the from coverage for property damage is limited.

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Typically to 15,000 a year. But when you take over management of a property, you have no idea whether it has mold, it doesn’t have mold, especially when we talk about buildings in Boston that are we’re built in the 19 hundreds have a provision stating that the association policy

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covers the manager for commercial general liability, and D now, and that the association agrees that the manager is covered under the insurance policy, even if it does something wrong.

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If they at the actors covered by the damages, were covered by insurance.

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The yeah. On, yeah. The defense and attorney’s phase, the identification should be for the entire case, until final adjudication.

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And after all, applicable appeals so you don’t have a question where the association is signed.

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Manager. We think you messed up. You’re on your own.

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That’s something that you have to talk to, counsel other than kind of minimum association lawyers about a manager should be named as does that designated agent an obligour in the Associations for Deliberate insurance that protects both the association against Acts by the

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employee, but also principles of the management company, and also as beneficial to to to the manager.

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Try to find a directors and options liability policy.

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Yeah, where the manager is automatically named by designation, or it can be the added for additional additional premiums, and that, as with all insurance, there are exclusions.

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If you have a claim that has no coverage, is it gonna be the association board, or there’s it.

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The Internet owners or the manager who’ll be paying for it.

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And if you have 2 million dollars of coverage, and you have a 10 million dollar claim.

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What do you do? And that is something that Thomas is going to.

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Get hit into now shifting to the next slide.

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Oh, the next one!

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Slide. 5. Okay, there we go.

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One margin, now to the slide. 5. Okay. So the big deal about surfside and the collapse and surfside Florida Champlain Tower, south.

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Killing 98 people is that the liability claims which are paid a all over the place by various parties added up to 1.2 billion dollars a billion with a big when I’m talking about most surfside property limits surfside was insured for South was insured for I believe

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37 million dollars through great American. Everybody believes that the value probably was triple that, and to rebuild the building.

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The because of the high exposure that the case had, that the world knew about this incident, and because the cost of litigation right American out of the shoot paid into court the 37 million dollars stated limits and 40 million dollars above it, and what the hands of the claim got some

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goodwill, but then stop writing Cardinium insurance in the State of Florida.

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You’re not gonna be so lucky. If you’re a pub policy is for 20 million dollars, and it costs 30 million dollars to reconstruct it.

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You are. Only gonna get 20 million dollars the way to know what the State limits are correct would be by having a license insurance reconstruction appraiser apprais the building and say, this is what it would cost to reconstruct this building in

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2023. Additional. Concern.

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The concerns are some companies offer a guaranteed replacement cost, which states that the carrier will pay, or the reconstruction will build on, or whatever it costs.

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Companies, such as C. Au. And Philadelphia, both after that, as do other carriers.

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But yeah, if you have that, you don’t have to worry about the actual cost of replacement.

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It’s whatever old cost to replace the bill length that’s called guaranteed replacement cost coinsurance, provision should not be part of that co insurance provisions and agreed amount means something totally different than that the carrier and the agent agreed that the 20

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1 million dollars of insurance is enough to replace the building.

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It actually has to do with a formula, for, say, a claim of $40,000, where, if you’re insured for 10 million, it should be 20 million, if sure, will only pay you 10,000 on the $20,000 claim guaranteed replacement cost if available, is strongly get should

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be strongly considered cost to rebuild concerns, labor, inflation, materials, post covid supply chain issues, the cost of lumber, create issues.

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The other issue is, let’s say that a region is impacted such as Hurricane, Sandy, or east, and contractors from across the country are flooding into the State and the demand exceeds the supply class.

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Will double a triple and so contractors will be able to demand much more in terms of price.

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So even with the insurance reconstruction appraisal.

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Yeah, you could not you might find that you have a a shortfall.

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So the surge, pricing again would be eliminated.

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What they guaranteed. Replacement costs of provision.

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Yeah, I was just gonna turn it over to you. So yeah.

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Stephen. 2, though is that what we I was gonna say, one of the things we found, especially during Covid is that there was almost kind of a hold on building valuation increases because everybody didn’t know is gonna happen.

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So you saw lumber labor, everything else kind of going crazy and some of the carriers kind of decided like, let’s sleep and dogs lie for a little bit.

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And what’s happened is you’ve seen inflation take off.

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You’ve seen a lot of changes in the market, especially with losses that now they’re playing playing catch up. And a lot of these buildings that used to be a hundred $5,075 a square foot to rebuild at a minimum are 2 25 to 50 and that’s

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not accounted for in that total building limit that you’re seeing out there.

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So you’re getting a lot of cost pressures from the rate side of it, as well as the actual building valuation that needs to be increased as well.

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So those.

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Let me let me add them something to that.

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To put it in in terms of reality as a hype, but as a hypothetical.

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If you have 10 million dollars of insurance, and you have a total loss, and the cost is 20 million dollars.

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So 15 million, put yourself in the position, such as in Sir side of going in front of a group of owners and telling them that there’s a 5 million dollar shortfall, because it actually will cost 15 million dollars to replace the condominium versus 10 million the

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it’s guaranteed that the manager, the trustees, the insurance people.

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Everybody’s gonna be under fire. The final thing.

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I wanted to enter that end on, and then turn it over to Tom.

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Is ordinance. A lot coverage, so you could have the property limits are ensuring for things that exist.

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But how about insuring for things that don’t exist?

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Well, if a building goes down, for example, a Massachusetts in Florida by 50% or more, they in the building has to be rebuilt to code and code might be things that didn’t weren’t.

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There, but now should be such as automatic fire, suppression systems and the like, and in some cases these can run into 1 million 2 million 5 million dollars of additional costs.

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You can bring in a code expert. Get a knock vector engineer to cost out the cost, to upgrade, to code.

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If there were a loss. But the only thing I can guarantee you is that even if you had a guaranteed replacement cost policy for property, if you had no ordinance, a lot or some insurers give 300,000, you are not in short but anything beyond that.

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It’s a massive issue that I think is understood in our area, because some of the age of the buildings even if it’s a newer building, you might have an issue, because building code just change so frequently.

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An example I would give is, you know, a roof that was done in the nineties.

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That seems to be fine. The wind gets blown off, but guess what you’re gonna get money to get that roof replaced.

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But building code today now says that you have to put extra insulation.

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You have to do different type of building techniques. That additional cost is not included in that payment from the insurance company unless you have the proper law and ordinance coverage.

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That’s the increased cost of construction component that Stevens, talking about.

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And it goes beyond that, too, because you look at there’s 3 coverages for law and ordinance, undamaged portion of the building, demolition, debris, removal, and the increased cost.

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When you have your policies you should always be looking to see that something is included for those coverage A, which is the undamaged portion of the building needs to be the full building limit have to have that on there as full building limit coverage B and c you’re gonna get sub limits.

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And you get different ways that they do it, but based on the characteristics of your building, you need to be kind of your advocate, because you know it better than I would.

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I’m gonna learn about it. But I’m not gonna live and breathe that every single day of you being in the building, that if you know the significant issues in terms of you know the that Ada, access or the elevators are too small, or just things in general that’s where you want to

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understand where that limit should be, to try and make you hold.

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But again, it’s it’s a fact that insurance companies are aware of this as well.

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So it’s not just a throwing coverage where you say, yeah, give me a million or 2 million of coverage, you know, B or C, what’s gonna happen is they’re gonna look at the characteristics you’re building see?

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It was built in 1940 and there’s been minimal updates.

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And they’re gonna say, well, if something happens to this one compared to one that was built 5 years ago, the cost for that law and ordinance is probably gonna be more expensive and it’s something you need account for, because it is kind of your duty as a manager or a board member to try and

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do it correct way. If you know that there’s issues.

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And what’s hit me is oh, for decades we’ve used.

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May these people, these 2 that weren’t born yet for decades we use Boston, and it was all the buildings were built in the 18 hundreds.

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The early 19 hundreds and it’s hit me recently that if you’re in the suburbs, if you’re in Newton or Easton or North Borough, that there are now buildings that were built, let’s say, in 1980 or 1990 at the time, so to

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me. That was current events, and seemed like it just happened. But some of these buildings are now 30, 40, 43 years old, and there has to be.

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They can’t be considered new anymore. And up to code that the building code has definitely changed in the last 30 or 40 years, and I think in the suburbs people aren’t thinking of code changes as much as they are.

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It could be as simple as a sprinkler system that some of the code change in the last 1015 years is that that building’s a full loss, and you have to rebuild it.

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Well, guess what you have to know add a sprinkler system to it.

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That’s not a small cost to add onto a building that’s being rebuilt.

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So that’s you know, these are factors, not. I guess we wanna try.

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And have you aware of it? Not have it consume you in terms of anxiety, but it’s something that you should be aware of.

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It should be a definite conversation you’re having with your agent or your anybody that you’re working with to try and sort out what’s the right thing for me?

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Because again, something in Boston, built in the 50 sixties versus something that’s new.

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And you know, Quincy, it’s gonna have different requirements in different thoughts of how you guys approach that in terms of ensuring it correctly.

00:26:02.000 –> 00:26:26.000
If we are a brownstone, and in the city of Boston so, and the surfside collapse is gonna trickle down into various states, and I don’t know if one of them will be Massachusetts where the requirements Mike might get a

00:26:26.000 –> 00:26:30.000
stricter that the codes might get strictter.

00:26:30.000 –> 00:26:36.000

00:26:36.000 –> 00:26:37.000

00:26:37.000 –> 00:26:40.000
I think the National Institute of Standards and Technology, which is the government whose government has investigating the cause of the collapse of the surfside bell.

00:26:40.000 –> 00:27:07.000
Lang needs 2 years to do their work, but when the work is done, if there are deficiencies that were noted that could have been part of the cause of the collapse, the reaction likely would be the change of building codes growth, country.

00:27:07.000 –> 00:27:08.000
And I would say to a degree when you look at your insurance policy, you look at the very bottom right of it.

00:27:08.000 –> 00:27:13.000
You’ll see some numbers. You’ll see a date like 11, you know.

00:27:13.000 –> 00:27:22.000
Oh, 7! Those are revisions to those insurance forms, and those dates are meaningful, because what they’re doing in the industry insurance industry is slow to react.

00:27:22.000 –> 00:27:30.000
But when they do, they react accordingly. What they’re doing is closing doors, or they’re changing verbiage in those policies to try and pick up issues that we’ve seen.

00:27:30.000 –> 00:27:37.000
And we know to be a problem for the carrier.

00:27:37.000 –> 00:27:40.000
They’re now fixing those by doing a revision.

00:27:40.000 –> 00:27:47.000
So when you look at those policies and you see different dates, and you see different coverage forms, it’s so meaningful to cause at the end of the day.

00:27:47.000 –> 00:27:51.000
It’s a legal insurance contract, and it’s it’s a living, breathing, legal document.

00:27:51.000 –> 00:27:56.000
And obviously, that’s a huge factor when you’re considering.

00:27:56.000 –> 00:27:57.000
Is this the right coverage for me? Is this the broadest possible coverage?

00:27:57.000 –> 00:28:09.000
Because when you build an insurance policy, you want the largest, most resilient, broadest policy you can get to try and not suffer a loss.

00:28:09.000 –> 00:28:21.000
You can have that in place and makes you so much more resilient to bad things that could happen to you, and that insurance policies the ticket for you guys to transfer that risk from your bank account to the insurance policy and the insurance carrier’s money.

00:28:21.000 –> 00:28:49.000
And before moving on to Tom and Jake, talking about the liability issues, which is a significant topic, we fully understand that with the 7 items I rattled off when I began, and as we’ve been digging deeper into the weeds on the issues of you don’t have

00:28:49.000 –> 00:28:50.000
to you. Don’t not only have to worry about property limits.

00:28:50.000 –> 00:29:06.000
You have to worry about whether the code change so my cost 3 million dollars more for an automatic priest oppression sprinklers system is that your volunteer board members?

00:29:06.000 –> 00:29:11.000
The managers. I’m not even if the boards want them to be experts on condominium insurance.

00:29:11.000 –> 00:29:22.000
There’s a conduit who can lead you to. They ensure kind of minimal insurance experts.

00:29:22.000 –> 00:29:39.000
But that perceived by the board as being quasi insurance agents, engineers, lawyers, accountants, and everything else, all for one flat fee per month, and that is unfair.

00:29:39.000 –> 00:29:55.000
But if nothing else, if you take away from the seminar that you have to, the managers have to have a discussion with the trustees.

00:29:55.000 –> 00:30:02.000
The or board members? And do I think 2 things.

00:30:02.000 –> 00:30:10.000
One is get permission to have the associations. Legal counsel, review.

00:30:10.000 –> 00:30:21.000
They kind of minimize, and the declarations pages of the insurance coverages and the Fannie Mae requirements, and then have the insurance professional.

00:30:21.000 –> 00:30:38.000
Somebody, such as Tom. Take a deeper dive into specifically exclusions that you should be aware of, because, unfortunately, every policy has an exclusion.

00:30:38.000 –> 00:30:55.000

00:30:55.000 –> 00:30:56.000

00:30:56.000 –> 00:30:59.000
So, if you be aware of, because, unfortunately, every policy has an exclusion. So if if you’re totally confused, it may be because of my inability to communicate this, probably by my concern, is that long before server side, these issues existed, so for the 43 years that i’ve been

00:30:59.000 –> 00:31:03.000
involved with. We’ve kicked the can down the road.

00:31:03.000 –> 00:31:11.000
Oh, yeah, the what’s the chances the building is gonna go down what’s the chances of that type of loss?

00:31:11.000 –> 00:31:16.000
What’s the chance that there would be a double horrific murder in a year and a kind of met a M.

00:31:16.000 –> 00:31:20.000
And claims of alleged lack of security or inadequate security.

00:31:20.000 –> 00:31:33.000
These are scary times. With that up, let’s say no.

00:31:33.000 –> 00:31:41.000
Let me shift to Tom and Jake to go into the liability issues.

00:31:41.000 –> 00:31:42.000

00:31:42.000 –> 00:31:46.000
Yeah, so yeah, definitely, we would kind of dove in with some.

00:31:46.000 –> 00:31:52.000
Sobering topics, but important to know that these devastating events can occur.

00:31:52.000 –> 00:31:56.000
And it’s, you know, it’s important to understand.

00:31:56.000 –> 00:32:02.000
So I kind of gonna spin it back a bit and we’re gonna get into general liability.

00:32:02.000 –> 00:32:03.000

00:32:03.000 –> 00:32:11.000
But also umbrella insurance. So we’re gonna flip forward to, you know.

00:32:11.000 –> 00:32:18.000
Tom and I are just gonna go over a bit of the different areas of insurance that you can kinda delve into.

00:32:18.000 –> 00:32:19.000
So I’ll.

00:32:19.000 –> 00:32:33.000
One thing I would add to Jake and I made a note here just because I thought it was very important that at the end of the day and Stephen kind of touched on it I’m not costing anybody anything when it comes to my knowledge right so in certain

00:32:33.000 –> 00:32:44.000
circumstances, the best trust relationships, and even when there’s tough news to deliver is when you’re use to the best of your ability.

00:32:44.000 –> 00:32:57.000
So in terms of speaking to a board, or speaking to a manager there’s only so much you can do if you keep a professional, whether it’s me or somebody else that you work with at arm’s length, we live and breathe this every day.

00:32:57.000 –> 00:33:05.000
It’s my specialty. So if you wanna have a good understanding and not have to play telephone, it’s important to involve us in those discussions, whether it’s with annual meetings or it’s talking to the board.

00:33:05.000 –> 00:33:27.000
We want to build report, and for me, especially when working with managers, I want to put them in the best possible light and show value to them into their clients, because I was brought in to be that person so I think using people who are smart and know what they’re doing to try and help further your

00:33:27.000 –> 00:33:35.000
relationship help further, what’s good for the client is so needed in these situations that I think it’s overlook sometime as just a vendor of you know what’s the cheapest or what’s the easiest solution to the problems at hand?

00:33:35.000 –> 00:33:45.000
So I just I feel like it was necessary to drop that in there, so we can continue on.

00:33:45.000 –> 00:33:48.000
Awesome, alright, so we’ll move on to the next topic.

00:33:48.000 –> 00:33:52.000

00:33:52.000 –> 00:33:55.000
Hi! Good! Come back to the live.

00:33:55.000 –> 00:33:56.000
Yeah, and, Jake, if you wanted to, I’ll rattle off the general liability concerns as well as the do, you know, especially when you talk about ser Side and the 2 surgeons.

00:33:56.000 –> 00:34:03.000
I wouldn’t. Yeah, perfect. Yeah.

00:34:03.000 –> 00:34:12.000
So what generalizability? How I was gonna just kinda do a quick, high level is that general liability is third party coverage.

00:34:12.000 –> 00:34:16.000
So it’s under claimants of bodily injury and property damage.

00:34:16.000 –> 00:34:22.000
So that’s the slip and falls things of that nature that somebody comes to the association seeking damages or medical any in between. That’s an unknown party.

00:34:22.000 –> 00:34:33.000
So that’s what general liability is meant to cover right and then, do you know, coverage is meant to cover right?

00:34:33.000 –> 00:34:38.000
And then Dn O. Cover is sorry. D, you know, coverage is directors and office coverage is separate from that, and what it is.

00:34:38.000 –> 00:34:44.000
It’s really coverage for wrongful acts.

00:34:44.000 –> 00:34:48.000
Defense of the Association Board. You’re spending, and you’re volunteering your time.

00:34:48.000 –> 00:34:51.000
This is now the actual decision-making insurance for you.

00:34:51.000 –> 00:34:59.000
The board, which is extremely important, and when you go through, how do you interact with the case?

00:34:59.000 –> 00:35:02.000
And I’ll talk about the 2 surgeons in Boston.

00:35:02.000 –> 00:35:08.000
Of what do you have to be aware of now? One is the limits right?

00:35:08.000 –> 00:35:17.000
That in today’s day and age you see primary coverage for general liability capping on a million dollar.

00:35:17.000 –> 00:35:22.000
And we all know that if something is significant has happened in Boston, we know that’s going to cost more.

00:35:22.000 –> 00:35:27.000
Then that actual money that’s allowed to be included in that policy.

00:35:27.000 –> 00:35:30.000
So what are your options? Same thing with Dno?

00:35:30.000 –> 00:35:39.000
If you have a massive claim, that’s gonna be over a million dollars, what are your options you can raise the limits on that or you can purchase an umbrella right?

00:35:39.000 –> 00:35:46.000
So the umbrella is something that sits over top of those primary coverages, and it extends those limits.

00:35:46.000 –> 00:36:00.000
And in today’s day and age, there’s some really good options as a lot of associations have gotten wise to this, that they pool their resources into a purchasing group and they’re able to buy umbrella to an Rpg some of you heard of them for

00:36:00.000 –> 00:36:09.000
the properties, and all these other ones that are out there, that you can get 5, 1015, 25 million dollars of coverage for relative decent cost.

00:36:09.000 –> 00:36:16.000
And it’s important to understand that when you have those losses these things aren’t gonna be accessed every day.

00:36:16.000 –> 00:36:20.000
It’s on those days those events that are so rare that that’s when it comes into play.

00:36:20.000 –> 00:36:25.000
But it’s it’s the it’s the need not have versus the have and not need.

00:36:25.000 –> 00:36:28.000
That’s the biggest question when it comes to those types of policies.

00:36:28.000 –> 00:36:36.000
So I just thought that was important to kind of put those 2 out there, and from a a general liability perspective with the incident.

00:36:36.000 –> 00:36:47.000
Boston. Too. You need to take ownership of his association, or a management firm of any type of issues that you might have knowledge of, that you can correct and fix right.

00:36:47.000 –> 00:36:48.000
So any circumstances, things are gonna happen. That’s why you buy insurance.

00:36:48.000 –> 00:37:05.000
It’s for the unknown. But if you had knowledge of a door that was not working properly, or was not locking or not latching, or there was major issues in the association that you had knowledge of I’m sure Steven and Jake can speak to this That’s where now

00:37:05.000 –> 00:37:06.000
negligence comes into play for you, being involved in that.

00:37:06.000 –> 00:37:15.000
If you can remove those from the equation, the limits are one thing, but if you can remove those things, those are the things that you can do to help protect yourself in these situations.

00:37:15.000 –> 00:37:23.000
I’m not saying. I know what that specific claim is, what I’m trying to explain to you is there’s steps you can take.

00:37:23.000 –> 00:37:26.000
Another example is a tree right? If you have a tree that’s hanging over someone’s property, or it’s looks like it’s going to fall down and eventually falls down.

00:37:26.000 –> 00:37:39.000
That’s considered an act of God. But if you had knowledge that it was dead or dying, and it was gonna affect someone in their writing you letters saying, Please remove that tree, or can you please fix that?

00:37:39.000 –> 00:37:42.000
And then it happens there’s a certain level of negligence out there.

00:37:42.000 –> 00:37:44.000
So that’s the thing to be aware of is control.

00:37:44.000 –> 00:37:52.000
What you can control these situations, and that’s really the best you can do.

00:37:52.000 –> 00:38:00.000
Excellent. Yeah, no. So that’s a good, a good overview of, we kind of dove into the devastating acts.

00:38:00.000 –> 00:38:12.000
And what and what can happen with that? But really understanding from, you know, umbrella level to directors and officer level to commercial general liability, level.

00:38:12.000 –> 00:38:13.000

00:38:13.000 –> 00:38:17.000
What type of what type of insurance you’re getting is that’s something that property managers and boards that you need to know.

00:38:17.000 –> 00:38:19.000
You need to know what you’re signing up for.

00:38:19.000 –> 00:38:21.000
A lot of people will just so I’ll go with X Brand Insurance Company.

00:38:21.000 –> 00:38:32.000
But it’s important to know exactly what’s in your exactly what’s in your policies.

00:38:32.000 –> 00:38:37.000
The terms and conditions all that. So we’ll with that, we’re gonna get to the.

00:38:37.000 –> 00:38:47.000
Hey! Just gonna have one thing, 2 quick. Jake, is that the D, you know, is extremely important, because, as I said, I noted it’s the decision making protection for the board, but it also funds.

00:38:47.000 –> 00:38:55.000
The managers, property, management, agreement. So it’s something that you don’t want to skimp on, and it’s a completely different policy than what you normally used to.

00:38:55.000 –> 00:39:05.000
It’s a claim has made policy. So anytime you deal with Dn O, be very, very vigilant in terms of leaving the carrier, or what you’re gonna have for coverage is because they’re not all made the same.

00:39:05.000 –> 00:39:08.000
There’s specific condo d policies that are very, very important.

00:39:08.000 –> 00:39:19.000
That include very important coverages, that some might not example number one, especially with new construction, is the developer included on that things of that nature.

00:39:19.000 –> 00:39:24.000
You need to account for, because as a board member, you’re volunteering your time, you don’t want to volunteer your money personally to try and pay for things to protect yourself.

00:39:24.000 –> 00:39:30.000
That’s the key piece of the notes. Don’t skip on that line.

00:39:30.000 –> 00:39:40.000
They’re very reasonably priced, and they offer them such immense protection for people that are volunteering their time and trying to help better things for a community.

00:39:40.000 –> 00:39:42.000
Absolutely. Yeah, no, it just a very important topic.

00:39:42.000 –> 00:39:49.000
And not know what you’re signing up for.

00:39:49.000 –> 00:39:50.000

00:39:50.000 –> 00:39:52.000
And Tom hit it. Hit on it all the time. The next topic we’re gonna kind of dive into is is slightly different.

00:39:52.000 –> 00:39:57.000
This involves fidelity, issues and crime coverage limits.

00:39:57.000 –> 00:40:23.000
This is another threat to communities. I’m going to start with a short little recent news in Florida, but of an alleged crime scheme that was going on over the course of a few years by some board members in a

00:40:23.000 –> 00:40:40.000
a big community down here regarding a basically over a million dollars of funds where, where embezzled allegedly embezzled, fraudulently siphoned off to to the board members.

00:40:40.000 –> 00:40:52.000
So how do you protect yourself from crime or essentially theft, social engineering, fraud, embezzlement, forgery?

00:40:52.000 –> 00:41:10.000
How protect yourself from these types of of actions and kind of just starting with the management company and protecting yourself as a designated agent and all the gore on the Association’s policy.

00:41:10.000 –> 00:41:16.000
You’re assuming some very, very important responsibilities in that this kind of ties into something we’ve hit on in previous sessions, just about management agreement.

00:41:16.000 –> 00:41:26.000
No. What’s in the management agreement between the management company and the association.

00:41:26.000 –> 00:41:32.000
So it’s important to know that, but also know what your responsibilities are.

00:41:32.000 –> 00:41:43.000
As the management company. These include these could include depending on your management agreement, administering the policy and this goes back to what we were discussing.

00:41:43.000 –> 00:41:44.000
The last slide, getting the right policies, getting the right insurance for your association.

00:41:44.000 –> 00:41:55.000
And and then, once you have the policy in sharing complaints with the policy terms.

00:41:55.000 –> 00:42:00.000
And this this could be in management during the claims process.

00:42:00.000 –> 00:42:07.000
We’re just ensuring that you understand all terms, conditions, exclusions, and so on.

00:42:07.000 –> 00:42:11.000
So it’s really, really, really important to ensure that.

00:42:11.000 –> 00:42:28.000
And as it relates specifically to fidelity, crime coverages really carefully review the insurance policy, know the terms and conditions, know the exclusions, and this is an important area.

00:42:28.000 –> 00:42:35.000
As far as a different type of crime. Cybersecurity, crimes, a lot of the exclusions.

00:42:35.000 –> 00:42:37.000
And cybersecurity. Crimes can be a bit a bit harder to understand, and so know what you’re signing up for.

00:42:37.000 –> 00:42:49.000
Know what’s excluded in your policy. Know what’s going to be covered, or should be covered should an event occur.

00:42:49.000 –> 00:42:54.000
And really really understand your responsibilities as as the property manager or.

00:42:54.000 –> 00:42:59.000
I was. Gonna say, Jake, too, the cyber is because no standardized agreements are in place.

00:42:59.000 –> 00:43:07.000
So it’s kind of a Wild West show right? And then, in addition to kind of building on those clause that you want to be aware of, not all policies are made the same.

00:43:07.000 –> 00:43:13.000
I think we’re pretty much hammered that home when it comes to crime and fidelity.

00:43:13.000 –> 00:43:14.000
It. There’s 2 areas too, that you wanna kind of build on. And I know we’re gonna talk on them.

00:43:14.000 –> 00:43:22.000
But one of the clauses to be aware of is, does your policy have a conviction clause right?

00:43:22.000 –> 00:43:38.000
Because we’re talking about is crime here. So you might have knowledge of a somebody, you know, taking funds or mismanagement of it, or anything in between some policies have a conviction clause that you need to have a conviction for somebody that did it in order for it to pay which

00:43:38.000 –> 00:43:45.000
is gonna be very, very tough for the Association to recoup funds right away and use it if you’re waiting for a conviction to take place.

00:43:45.000 –> 00:43:55.000
In addition to that notification so obviously when you notify the carrier of knowledge of it, is there a clause for notification of the police or anybody?

00:43:55.000 –> 00:44:03.000
Sometimes those are in there, so if you don’t do those things or protect yourself or understand it, that policy is not going to operate the way you need it to.

00:44:03.000 –> 00:44:13.000
And I think we’ve all seen some of the requirements from the State, from the local areas like Snmla Fa.

00:44:13.000 –> 00:44:16.000
Anybody in between right? 3 months in reserves that’s usually like the bare minimum of what we’re gonna see. There.

00:44:16.000 –> 00:44:23.000
But when it comes to reserves, does that mean improvement?

00:44:23.000 –> 00:44:30.000
Of projects. That’s what I was. Jake and I were having a conversation before and Stephen about those things.

00:44:30.000 –> 00:44:34.000
Where does that come into play in a social engineering? We can touch on that.

00:44:34.000 –> 00:44:46.000
But you know I don’t wanna jump too far ahead, Jake, because I know you had a couple of things, but it’s there’s many factors that come into this again that if you can walk away from this and realize that it’s not all.

00:44:46.000 –> 00:44:51.000
Manufacturing the same, and there’s nuances that you don’t want to have come into play.

00:44:51.000 –> 00:44:55.000
It’s something that you wanna trust. An agent who’s done these things.

00:44:55.000 –> 00:45:05.000
Who fought these battles? Who’ve seen these battles instead of someone that might do it some of the time.

00:45:05.000 –> 00:45:06.000

00:45:06.000 –> 00:45:07.000
That’s the most important factor to especially the legal team that you use if you live in like.

00:45:07.000 –> 00:45:12.000
Obviously Steven and Jake, their firm does like that’s so meaningful.

00:45:12.000 –> 00:45:18.000
Instead of just trusting someone that’s been around for, you know, a couple of years, or this hasn’t been their life blood for the last 2030 years.

00:45:18.000 –> 00:45:23.000
I think that’s so meaningful is that in today’s day and age the value of knowledge that people possess is sometimes discounted for a product that’s inferior or cheaper.

00:45:23.000 –> 00:45:34.000
You know, I think there, I think there’s value in that.

00:45:34.000 –> 00:45:41.000
A hundred percent. So yeah, this definitely, and you kind of touched on you touched on the yeah.

00:45:41.000 –> 00:45:44.000
The 3 months reserves that we were discussing. It, and we’ll get a little more into reserves on the next slide.

00:45:44.000 –> 00:46:06.000
But yeah, a as a management company just along the same lines of in sharing that you’re complying with policy terms when you’re looking at the depthation pages of a policy you want to see, you want to see what the limits

00:46:06.000 –> 00:46:11.000
are, and what is cover, it will usually say per occurrence.

00:46:11.000 –> 00:46:12.000
We’ve all seen these policies understand what that means.

00:46:12.000 –> 00:46:21.000
Understand what? Your yeah, as I said, what you’re signing up for.

00:46:21.000 –> 00:46:28.000
But even taking it a step further, make sure. Yeah, you’re maintaining 3 months reserves.

00:46:28.000 –> 00:46:36.000
You have adequate operating expenses, and you also have a line of potential.

00:46:36.000 –> 00:46:43.000
You know, lending adequate lending options are an ability to obtain loans.

00:46:43.000 –> 00:46:50.000
Okay. Maybe the wrap up on the Fidelity.

00:46:50.000 –> 00:46:51.000

00:46:51.000 –> 00:46:56.000
Yeah, cause we’re losing some time is Massachusetts requires that you have 3 months of the annual budget.

00:46:56.000 –> 00:46:57.000

00:46:57.000 –> 00:47:07.000
For fidelity. You have to have the total funds on hand at any time, or what the State law requires.

00:47:07.000 –> 00:47:13.000
So in theory and association, could get well, we’re just gonna get the minimum.

00:47:13.000 –> 00:47:24.000
We’ll get 3 months, let’s say the budgets 120,000 we’ll we’ll get $30,000 of fidelity in a day.

00:47:24.000 –> 00:47:44.000
But what if you have an additional that a million dollars in and call it a day? But what if you have an additional that a million dollars in in reserves now it’s over a million dollars and now let’s say that you get a a loan from one of the lenders to

00:47:44.000 –> 00:48:06.000
us, associations and those in advance of an additional 1 million dollars. There’s now over 2 million dollars that could be stolen if in my mind, if I were a trustee or a manager, I’d wanna make sure that every dime was protected by fidelity insurance because I

00:48:06.000 –> 00:48:07.000

00:48:07.000 –> 00:48:15.000
don’t know whether a trustee, a manager, a man, company employee, notation employee, could fail funds, but it does happen a couple of times each share across the country.

00:48:15.000 –> 00:48:25.000
So I’d rather have the proper limits of coverage.

00:48:25.000 –> 00:48:30.000
Yup. So the next one, yeah, we kind of touch on.

00:48:30.000 –> 00:48:47.000
This is more of a word of caution, so I am licensed as an attorney in Florida and Massachusetts, and in Florida we have seen significant developments in the insurance world.

00:48:47.000 –> 00:48:54.000
Among other worlds, with most condo issues, if it hits Florida.

00:48:54.000 –> 00:48:59.000
The expectation is that it can generally flow east and come to New England.

00:48:59.000 –> 00:49:08.000
For example, there, there are in light of Star Slide, which we’ve discussed in this.

00:49:08.000 –> 00:49:31.000
In this program there are certain reserve and inspection requirements that are coming into play down here in Florida that basically bye, bye, the beginning of 2025 buildings along the coast of or within 3 miles of the coast of Florida will require certain or that associations

00:49:31.000 –> 00:49:41.000
maintain certain reserve accounts, conduct certain reserve studies as well as conduct structure on inspection of the properties.

00:49:41.000 –> 00:49:48.000
This is the are they gonna it’s called Sers. And it’s structural inspection requirement.

00:49:48.000 –> 00:50:05.000
And basically right along those same lines, there has been a lot of news about an insurance crisis in Florida not not to people that it’s Gonna flow directly to New England.

00:50:05.000 –> 00:50:13.000
But it’s kind of a a lesson that can be learned from Florida and of course Florida has different issues.

00:50:13.000 –> 00:50:14.000
We already discussed the fraud scheme that occurred.

00:50:14.000 –> 00:50:26.000
There is a lot of insurance fraud. Unfortunately, in Florida, natural disasters, such as storms, even though every geographic region is oh!

00:50:26.000 –> 00:50:29.000
Could be prone to some type of natural disasters.

00:50:29.000 –> 00:50:46.000
The storms and hurricanes, and Florida could be potentially worse, but basically, what’s been happening is a lot of insurance companies have been liquidating and entering receivership to be exact, I think, since 2019 7 insurance.

00:50:46.000 –> 00:50:52.000
Companies have in Florida have liquidated, and 5 others are in the process of currently liquidating.

00:50:52.000 –> 00:51:05.000
At this point, citizens insurance. There’s Ben news especially triggered by the Florida Governor Ron de Santis.

00:51:05.000 –> 00:51:11.000
That Florida may be in in a a precarious situation, with even their government entity.

00:51:11.000 –> 00:51:29.000
Citizens Insurance Company, which is state-backed, and even though so citizens has become the necessary insurance company because they’re basically, as I think, their CEO.

00:51:29.000 –> 00:51:33.000
No said citizens is basically the only game in town.

00:51:33.000 –> 00:51:43.000
And because so many of these other insurance companies in Florida have been having issues and and effectively, as I’ve touched on a bit in Florida.

00:51:43.000 –> 00:51:44.000
Yeah, there’s the hurricanes of storms, natural disasters, as well as fraud.

00:51:44.000 –> 00:51:52.000
Increased litigation, and Florida has been has been a problem.

00:51:52.000 –> 00:51:56.000
So that has kind of left citizens as the solution.

00:51:56.000 –> 00:52:06.000
But it seems more of a Band-aid, and especially when you hear the news that the Is Citizens Insurance Company experiencing a a solvency issue.

00:52:06.000 –> 00:52:10.000
That’s not good to hear, either, for a government backed entity.

00:52:10.000 –> 00:52:24.000
So well, and also just to touch on one other question for homeowners, citizens is somewhat of a of a risky insurance company to engage with, because they’re immune from bad faith.

00:52:24.000 –> 00:52:35.000
As a government entity, so the claims handling can be a little bit less than ideal.

00:52:35.000 –> 00:52:41.000
In some situations. But enough on citizens. What does what does this mean for other areas? And I’ll.

00:52:41.000 –> 00:52:45.000
Yeah, I I was, gonna say, Jake, that it’s the canary in the coal mine is Florida right?

00:52:45.000 –> 00:52:49.000
Is that a lot of the issues that you’re gonna have down there?

00:52:49.000 –> 00:52:55.000
You’re gonna see it applied to everywhere else, whether it’s the insurance carriers or the losses cause.

00:52:55.000 –> 00:53:00.000
I think one thing that I hear of one thing that I need to explain sometimes is that losses in other parts of the country affect losses here right?

00:53:00.000 –> 00:53:03.000
Because at the end of the day the insurance company that puts the 10 million dollars up for your building, they might only keep a very small portion of that in house.

00:53:03.000 –> 00:53:11.000
What happens is they take that fragment and they move it around to other places and all those other places shared with other places.

00:53:11.000 –> 00:53:16.000
And now it’s that’s why it’s global, right?

00:53:16.000 –> 00:53:20.000
It’s nationally and internationally so when you have massive issues in Florida, you have wildfires, and in California you have floods.

00:53:20.000 –> 00:53:28.000
In whatever it could be. All those things someone’s paying out.

00:53:28.000 –> 00:53:34.000
And if someone’s paying out, and they have part of your coverage up here in the northeast, they’re gonna have to recru their losses.

00:53:34.000 –> 00:53:39.000
And you have other factors. As we talked about here is that, you know, labor issues.

00:53:39.000 –> 00:53:45.000
We have so many factors that are just putting a desk grip on the market.

00:53:45.000 –> 00:53:54.000
It affects it in so many different ways. So what happens is, you have reduced capacity as one of those notes that he he said.

00:53:54.000 –> 00:53:58.000
Right here. What happens when you had 10 carriers trying to get your insurance last year?

00:53:58.000 –> 00:54:01.000
But they had losses because they are underwriting.

00:54:01.000 –> 00:54:08.000
You know the reinsurance carriers all across the country got clobbered, and now they’re pulling out. Now you only have 3 carriers to go ahead and compete against your insurance.

00:54:08.000 –> 00:54:22.000
Or those 3 carriers that are left. Their rates are going to go up as well so you’re going to see the marketplace kind of disintegrate and look, there’s some programs there’s some carriers out here that you’re not seeing huge

00:54:22.000 –> 00:54:25.000
increases what it comes down to is, Are you coastal?

00:54:25.000 –> 00:54:28.000
Do you have massive wind issues? Are you on sprinklered?

00:54:28.000 –> 00:54:34.000
Are you frame, you know? Do you have high values like those are the things that on the edges might not, you know, think?

00:54:34.000 –> 00:54:38.000
Oh, hey! I’m fine! You’re still gonna see?

00:54:38.000 –> 00:54:42.000
An increase, because maybe the cost of your building is not enough.

00:54:42.000 –> 00:54:49.000
So you see, in the insurance market what all these forces on like, I said, reduce that capacity and lack the competition rate increases and valuation increases.

00:54:49.000 –> 00:54:55.000
The rate is what they charge you for. That building and then the valuation is how much it costs.

00:54:55.000 –> 00:54:58.000
So, if those go up so is your insurance premium.

00:54:58.000 –> 00:55:03.000
So it’s again. It’s all intertwined when it comes to losses that I might not have ever had a loss.

00:55:03.000 –> 00:55:10.000
But trust me, the company that, ensures you had some really terrible ones you’re not gonna be immune to that because you didn’t have any losses.

00:55:10.000 –> 00:55:12.000
You’re gonna see an increase. So now it comes down to is, what’s my position in the marketplace?

00:55:12.000 –> 00:55:15.000
What is my loss? History? What are the characteristics of my building and my coastal frame on sprinklered?

00:55:15.000 –> 00:55:31.000
And there’s a I’m down the Cape like you’re gonna get hammered when it comes to the renewal, and a lot of agents sometimes sticking their head in the sand, or they try to explain, hey?

00:55:31.000 –> 00:55:42.000
Look, this is what’s going on. And might not be receptive but there’s some major issues as major pressures that you, as a manager, should be aware of you as a board, should be aware of that there is a lot of turmoil.

00:55:42.000 –> 00:55:43.000
Now, so if you, are able to get 5% or 10% on the renewal, that’s pretty fair.

00:55:43.000 –> 00:55:47.000
But if you have.

00:55:47.000 –> 00:55:54.000
Let me add another another topic, that doesn’t show on the slide.

00:55:54.000 –> 00:56:05.000
But this have been some rethinking of ideas that have been accepted in the past.

00:56:05.000 –> 00:56:06.000

00:56:06.000 –> 00:56:11.000
40 years or so, and one of them actually came to the form of a question by an attendee.

00:56:11.000 –> 00:56:27.000
Bill? Who’s a board member, I believe still, and a an excellent attorney, and his question was, while they, for convenience, they employee ease of the Association, are like the Lifeguards and security people.

00:56:27.000 –> 00:56:36.000
The people who will stay even with the manager is terminated, or leaves are.

00:56:36.000 –> 00:56:37.000

00:56:37.000 –> 00:56:40.000
Because they are under the managers, their employees are the manager, and under their the their employees are the manager, and under their their work is comp and liability, coverage, etc.

00:56:40.000 –> 00:56:47.000
And the question really was, should they be employees of the Association?

00:56:47.000 –> 00:57:13.000
And the question really was, should they be employees of the association well, with the security case in South Austin, where the may be a judgment of settlers? Who knows? I’m guessing on tens of millions of dollars?

00:57:13.000 –> 00:57:24.000
So, and the Navy issues has to the security that you do get into questions about.

00:57:24.000 –> 00:57:44.000
So should there be some rethinking of whether employees should be the associations, or should continue to be the managers, and then there’s case law over the past few years which talks about dual employees Tom I don’t know if you have if you’ve seen that

00:57:44.000 –> 00:57:52.000
issue raise, or whether management companies are continuing to have the employees as their own.

00:57:52.000 –> 00:58:03.000
So, yeah, you know, just as another piece why, Florida relates to New England, and why Florida is a can serve as a word of fashion.

00:58:03.000 –> 00:58:10.000
There is some reform that’s going on as far as legislative.

00:58:10.000 –> 00:58:11.000
Just trying to fix the issue. This includes limiting litigation.

00:58:11.000 –> 00:58:31.000
This includes financial assistance to associations that may struggle to pay, but yeah, I mean in our last note, it says, What if you’re association cannot get insurance another way that and we touched on it a bit that you can kind of protect yourself.

00:58:31.000 –> 00:58:35.000
Is requiring adequate reserves, which that’s what Florida is doing.

00:58:35.000 –> 00:58:49.000
They’re gonna have reserve requirement and statute right now, Massachusetts, the reserve language in the in 1 83, a section 10 is adequate reserves, which is kind of vague.

00:58:49.000 –> 00:59:04.000
But if you ensure that your maintainer adequate reserves, that, as we mentioned in the previous slide management companies, looking at the You know your insurance policies, making sure your you’re getting what suits your needs.

00:59:04.000 –> 00:59:05.000

00:59:05.000 –> 00:59:09.000
These are prophylactic ways that you can kind of protect, because again Tom hit it on the head, no one’s immune, especially if you’re a host, and that you’re.

00:59:09.000 –> 00:59:13.000

00:59:13.000 –> 00:59:21.000
Hey, Jake? And I? There was a question as well you talked about by so many in the audience is saying, what are you talking only about?

00:59:21.000 –> 00:59:22.000
Florida. What about Massachusetts, New Hampshire, Maine, Rhode Island?

00:59:22.000 –> 00:59:31.000
I think I’m reduced. Capacity, lack of competition R increases that validation evaluation increases local, national, international, concerns with the jurors.

00:59:31.000 –> 00:59:42.000
Basically everything other than citizens. Insurance, which is only Florida.

00:59:42.000 –> 00:59:53.000
That what has been talked about on the slide is global to the entire country, not just Florida.

00:59:53.000 –> 00:59:57.000
Oh, correct! So what I spoke on to is that’s Massachusetts right?

00:59:57.000 –> 01:00:00.000
That you’re gonna have issues with the same thing, whether you had claims or not.

01:00:00.000 –> 01:00:12.000
You’re gonna be affected, for example, working with a couple of associations that they were non-renewed because their coastal frame and they had degree into the marketplace and the marketplace is terrible.

01:00:12.000 –> 01:00:23.000
You’re not gonna get win coverage if you’re coastal and frame and and have those issues so you’re gonna see a massive increase.

01:00:23.000 –> 01:00:28.000
Now, why is that? Because a reduced capacity, lack of competition carriers pulling out it’s all intertwined.

01:00:28.000 –> 01:00:42.000
So Jay talks about that at a local level of Florida, but in terms of what I’m talking about is you can apply that to Massachusetts as well that there is market turmoil, and you need to protect yourself and you need to be explain why

01:00:42.000 –> 01:00:46.000
we’re seeing increases, because just saying, Hey, I didn’t have a loss.

01:00:46.000 –> 01:00:49.000
I expect to pay the same price as last year is not fair.

01:00:49.000 –> 01:00:51.000
It’s not fair to the insurance carrier that just spend 26 billion.

01:00:51.000 –> 01:00:54.000
And it’s not fair to you that you didn’t have a loss.

01:00:54.000 –> 01:01:02.000
So you need to have that conversation so everybody’s on to that same page and understand well, your rates are going staying flat, but your valuation of the buildings going up because you need more coverage.

01:01:02.000 –> 01:01:10.000
You need to have that accounted for. So those are the different factors that come into play, and on one account you might have one issue on another account.

01:01:10.000 –> 01:01:16.000
You might have 3 issues or 3 factors, so it’s really just having that open understanding of what the insurance market is.

01:01:16.000 –> 01:01:20.000
And obviously, Jake illustrated in Citizens.

01:01:20.000 –> 01:01:23.000
But again, Massachusetts is not a mutual to any of that stuff, and if you plug those things that happen in Florida, it’s gonna happen across the State.

01:01:23.000 –> 01:01:32.000
So on a national level. That’s a huge problem. Now, you can basically.

01:01:32.000 –> 01:01:37.000
We’re running at a time. So I hey, hey!

01:01:37.000 –> 01:01:47.000
No, I don’t know just. My my only point is this one, though, is that you applied that nationally, and you remove that, and then you add, citizens in Florida there’s going to be another spot.

01:01:47.000 –> 01:01:48.000
Maybe in, around us. It’s gonna you can change the names.

01:01:48.000 –> 01:01:51.000
But the song is still the same. That’s my point.

01:01:51.000 –> 01:01:58.000
Okay. That’s a great point. They, the next slide, is, just have your association legal counsel, an insurance professional.

01:01:58.000 –> 01:02:15.000
Look at your insurance I’m guessing that there are more master policies than that are more master policies than that.

01:02:15.000 –> 01:02:35.000
Have some fine, not so fine tuning, such as increase in limits that have some fine, not so fine tuning, such as increase in limits, increases on umbrella insurance for live.

01:02:35.000 –> 01:02:36.000

01:02:36.000 –> 01:02:38.000
Cgl. And pity. Now and then the final slide is comparing coverage options which we can give one or 2 min to discuss. We’re a little overly 110’clock hour.

01:02:38.000 –> 01:02:41.000
I I will! I will take jokes.

01:02:41.000 –> 01:02:42.000
I think one of the things that everybody needs to understand on the insurance that it’s not all equal in the capacity and ability of one agency.

01:02:42.000 –> 01:02:48.000
Another is not the same. So how can you protect yourself? And what can you do to try and make sure that you’re getting the best deal?

01:02:48.000 –> 01:03:01.000
If this is not something, you operate on a daily basis, so I think you need to simplify through a comparison and real quick, Jake, if you move it forward, one slide, I’ll just show you a quick example.

01:03:01.000 –> 01:03:07.000
Of something that we use right? You have one column of the existing or expiring, carrying.

01:03:07.000 –> 01:03:10.000
You have another one with a new carrier. Have it.

01:03:10.000 –> 01:03:20.000
Be simple, in terms of what’s being put in there, whether your agent adds it, or whether you ask them to put it or 2 agents competing, have it simplified so it’s apples to apples right?

01:03:20.000 –> 01:03:24.000
And then you can illustrate the data and you can have conversations of wise.

01:03:24.000 –> 01:03:28.000
This different? Why is this important? Why is this important? Why is this not important?

01:03:28.000 –> 01:03:43.000
Why is this need to be changed? I think, having those discussions and simplifying it is the best protection for you to advocate for the best possible program, and then, additionally, and Stephen touched upon this is that there’s probably only a handful of students in this area that really interact on a daily

01:03:43.000 –> 01:03:53.000
basis with condos, you know. Trust them just like you trust a law firm, and you trust you’re not going to have your neighbor work on your car because you know he has a bunch of wrenches right?

01:03:53.000 –> 01:03:56.000
You’re gonna have your neighbor work on your car because you know, he has a bunch of wrenches. Right? You’re gonna go to a specific mechan knowledge.

01:03:56.000 –> 01:03:57.000
They know what they’re doing. It’s the same thing when it comes to insurance.

01:03:57.000 –> 01:04:04.000
Don’t. We’s sake the knowledge and expertise that somebody has as they’ve lived and breathe this.

01:04:04.000 –> 01:04:08.000
Just say, Oh, well, in all insurance agents are created equal.

01:04:08.000 –> 01:04:13.000
I think it’s a of effort proportions that you can protect yourself just by calling the right people.

01:04:13.000 –> 01:04:19.000
And you know, that’s really the basics of this is just to understand and educate.

01:04:19.000 –> 01:04:24.000
If you spend 5 min with an anybody that knows what they’re talking about, educating yourself is going to lead to more questions and more understanding.

01:04:24.000 –> 01:04:27.000
If you’re a knowledgeable, you’re trying to be knowledgeable.

01:04:27.000 –> 01:04:34.000
Asking questions, you’re just gonna put yourself in a better position to protect yourself.

01:04:34.000 –> 01:04:42.000
So I think those are the things to try and make sure that you’re aware of, and that you use a new employee.

01:04:42.000 –> 01:04:43.000

01:04:43.000 –> 01:04:46.000
Thank you, Tom. Your check. You want to wrap up. We’re a little over.

01:04:46.000 –> 01:04:52.000
Yeah. No. Absolutely thanks. Everyone for staying in detention for the extra 4 min.

01:04:52.000 –> 01:04:58.000
But I hope this was a a useful exercise. We got again.

01:04:58.000 –> 01:04:59.000
If you have any questions, reach out to us directly. Here are emails on this final slide.

01:04:59.000 –> 01:05:11.000
Again, insurance is something that people they kind of start hearing it, and it’s like the Charlie Brown teacher.

01:05:11.000 –> 01:05:16.000
You kind of just tuned it out because it’s blah.

01:05:16.000 –> 01:05:22.000
But it’s important. You need it. It’s hopefully.

01:05:22.000 –> 01:05:25.000
This is a word of context, and not to scare people.

01:05:25.000 –> 01:05:34.000
But you need to know this stuff, and if you have specific questions, reach out to Stephen and I reach out to Tom.

01:05:34.000 –> 01:05:41.000
He’s been a great guest. Speaker hasn’t experience.

01:05:41.000 –> 01:05:42.000

01:05:42.000 –> 01:05:44.000
Thank you for having me. I’m sorry I appreciate it.

01:05:44.000 –> 01:05:51.000

01:05:51.000 –> 01:05:52.000

01:05:52.000 –> 01:05:53.000
Yeah, no, we had a great time. You were a great expert in this in this area, and we appreciate you coming on so.

01:05:53.000 –> 01:05:57.000
We wish everybody a great weekend.

01:05:57.000 –> 01:05:58.000
Is. There’s one of the funniest things you can do with your clothes on.

01:05:58.000 –> 01:05:59.000
Yeah, it’s.

01:05:59.000 –> 01:06:00.000
So thank you. I appreciate it.

01:06:00.000 –> 01:06:08.000
And what am will be sending to registrants in the sometime next week?

01:06:08.000 –> 01:06:10.000
The Powerpoint, and there were questions that were submitted prior to the program.

01:06:10.000 –> 01:06:19.000
We’ll give answers. Those questions and answers, and there are a couple of questions that were asked during the webinar.

01:06:19.000 –> 01:06:25.000
And we’ll try to give the answers to those as well.

01:06:25.000 –> 01:06:26.000
Thank you all.

01:06:26.000 –> 01:06:29.000
And enjoy the Kentucky Derby. Saturday.

01:06:29.000 –> 01:06:32.000

01:06:32.000 –> 01:06:59.000
Alright, thanks. Everyone have a good good weekend.


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