How to Mitigate Risk for Your HOA

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No HOA wants to take on unnecessary risks. However, sometimes these groups end up doing so unintentionally, even though they think they are doing everything right. Here’s what you need to know to protect your association no matter what.

Have the Right Insurance

Make sure that you have effective liability insurance and that it is always up-to-date. As time passes, you may need to take out more insurance or change the types of insurance that you carry. Never view insurance as something that you can set up, then forget about. Instead, review your policies regularly to make sure they still meet your needs.

Eliminate Unnecessary Risks

Some risks are simply unnecessary. For instance, many HOA organizations have chosen to remove diving boards from their swimming pools. While these are a lot of fun, they can also be the cause of major injuries. In fact, some liability policies may refuse to cover your pool if you have one. As time passes and researchers understand more and more about how dangers occur, you may need to remove things that are simply too risky.

Set Reasonable Rules

Make sure you set rules around anything risky. For instance, a swimming pool should have hours of operation posted so that people don’t try to swim in the middle of the night, when the pool is not monitored. Rules should cover who can use something, when they can use it, and how they need to act when they are using it so that everyone remains as safe as possible.

Follow the Law

All of your rules and regulations need to be legal under the federal, state, and local laws that pertain to your HOA. If you aren’t sure about something, you’ll want to consult with a legal expert who can advise you. That way, you can be sure that you aren’t accidentally leaving the association open to liability simply because you didn’t know your responsibilities.

Perform Regular Inspections

Make sure that common areas and common resources get inspected regularly. Hire people with professional licenses in the relevant areas to perform these inspections, so you never have to wonder whether they were done well or whether something is safe. Keep documentation of these inspections available in case association members want to see it or something happens. That way, you can prove that you did due diligence no matter what.

Document Everything

In fact, you should always err on the side of over-documenting things, rather than under-documenting them. This includes exchanging communications with vendors, members, other people on the board, and more in formats that you can save. Instead of talking on the phone, document with an email or at least follow up with an email afterward. That way, you have proof of what was discussed and what each individual said.

If you need help protecting your HOA, contact us at AMI today. Our professional teams include legal experts who can help you determine how you want to proceed with anything that might be considered risky for your HOA.

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