Each HOA Board is responsible to obtain insurance that meets the requirements of Law and the CC&R’S. There are four basic types of insurance necessary: Liability, Property, Professional and Employer.

Commercial Liability - is normally written at $1,000,000 per occurrence with a $2,000,000 total policy limit.  Some companies offer policies without a limit (Aggregate).  General Liability should be broad form which adds the following to the basic coverage, Fire Legal Liability, Contractual Liability, Personal Injury, Host Liquor Liability, Incidental Malpractice, Broad Form Property Damage, Premises Medical, Extend Bodily Injury.  In addition to General Liability much other specific coverage must be included.  Personal and Advertising Liability - which offers protection for false arrest, libel, slander malicious prosecution, wrongful entry or wrongful eviction.  Products and Completed Operations - insured for claims resulting from the product or services performed generally away from the premises.  Non-Owned and Hired Auto - provides protection for autos rented or used on your behalf while in the course of your business.  This valuable coverage extends to subcontractors and employees on Association business (lawn, pool).  The Liability Coverage should be written on an occurrence basis.  Liability policies having exclusions other than nuclear, war, act of god, or intentional acts will limit coverage.  If you have added specific hazards such as pools or playgrounds, an Excess (Umbrella) Policy to increase the limits of insurance should be considered.

Property Coverages insure against loss of property owned by the Association.  That coverage should be written on the broad (special) form which insures for all risks not specifically excluded with settlement on a replacement basis or better yet a guaranteed replacement basis.  The amount of coverage can be written on listed items or on a blanket basis, which is a single limit for all property.  Limits are subject to coinsurance, which means a claim can be reduced if the amount of insurance is less than the full value.  Most policies contain sub limits for specific items.  Check those sub limits they may be the very items you need to insure, lawns, plants, signs, and walls.  Property can contain much optional coverage also.  Crime, Fidelity, Employee Dishonesty - is a must for an HOA (Federal Mortgage Requirement) and covers the monies owned by the Association from theft by employees, members or board members.  Fidelity can be expanded to cover the Property Manager.  The amount should be 100% of bank balances as a minimum.  Earthquake and Flood - removes the exclusion for those losses.  Building Ordinance - adds coverage for the increase costs to comply with new building codes.  Theft, vandalism, sewer back up, and vehicle caused damage should all be added to the basic coverages.  Property coverages contain a deductible which is your amount of self-insurance. 
               
Professional Insurance - for a HOA is called Directors & Officers.  D & O contains the coverages for professional acts or lack of excluded from the General Liability.  This is by far the most misunderstood coverage needed by the Association and Directors.  It should be written as a duty to defend on claims made basis.  You must check who is covered and when you are covered.  Broad named insured is a must.  Do not accept a simple policy endorsement such as issued by Allstate, Farmers or State Farm, as there is a little to no coverage.  The policy should include all past, present and future Directors, discrimination defense, breach of contact, non-money suits, and prior acts.  Be careful there are only a few policies in the market that offer the above items.
               
Employer Insurance - called Workers Compensation provides coverage for employment related accidents.  The coverage is mandated in accordance by Nevada State Law and extends to sub contractors who may not be insured.

When choosing insurance review the offer carefully.  The offer should contain a list of the optional coverages added to the basic package.  Beware if that is not provided.  The insurance policy is a complex written contract.  An HOA should use an agent who has a history of writing HOA policies and understands your unique risks.  Obtain a list of the associations the agent insures as references.