Insurers are dropping HOAs, threatening the condo market

 

coverage is getting harder to locate and greater costly in plenty of the united states. simply ask owners' institutions.

Insurers are dropping HOAs, threatening the condo market

Homeowners' associations are struggling to find master insurance policies, forcing fees higher for residents.

Mirroring developments within the unmarried-family home market, insurers are boosting rates or exiting the enterprise of overlaying HOAs’ commonplace belongings absolutely, citing growing losses from intense climate and growing older homes. The steep premium hikes usually turn out to be exceeded directly to individual owners within the shape of higher monthly dues.

Yes, I've seen reports about that. Insurers are increasingly dropping coverage for Homeowners' Associations (HOAs), which is causing significant challenges in the condo market. This trend is driven by rising losses from extreme weather events and aging infrastructure. As a result, insurers are either boosting premiums or exiting the business of covering HOAs' common property entirely.

These higher insurance costs are usually passed on to individual homeowners in the form of higher monthly dues. For example, in Lakeville, Minnesota, one HOA saw its master insurance policy premiums quadruple to $236,000 annually since 2021. This has led to a doubling of monthly fees for residents, making homeownership more challenging for many.

The 2021 Surfside, Florida, condo collapse was a turning point that made coverage harder to keep, particularly for condo associations. The insurance issues have also affected HOAs made up of single-family homes, but they're most profound in communities of apartments, rowhouses, and townhomes because those developments have more communal features.

It's definitely a concerning situation for many homeowners. Do you think there should be more government intervention to address this issue?