Florida 718 master insurance mandate
What this clause says
The Association shall use its best efforts to obtain and maintain adequate property insurance to protect the Association and the condominium property, based on the replacement cost of the property to be insured as determined by an independent insurance appraisal or update of a prior appraisal, which replacement cost shall be determined at least once every thirty-six months.
What this means in plain English
Florida's Condominium Act imposes a specific insurance duty on the association itself. Under Fla. Stat. 718.111(11), the association must use its best efforts to maintain adequate property insurance on the condominium property, and adequacy is measured against the full replacement cost of the insured property, not its depreciated value. The statute requires that replacement cost be set by an independent insurance appraisal, or an update of a prior appraisal, at least once every 36 months. The statute also frames what the master policy must reach into the units, generally the property as originally installed or replacement of like kind and quality, and leaves owner improvements and betterments to the unit owner's HO-6. This is a distinct requirement from any lender or Fannie Mae condition; it binds the association by force of state law whether or not a single unit carries a mortgage.
What it means for an HOA board
For a Florida condominium association this is not a best practice, it is a statutory obligation that runs to the board. The two pieces boards most often miss are the valuation basis and the appraisal clock. Adequate insurance under 718.111(11) means replacement cost, so a master policy quietly renewing on actual cash value, or on a stale insured value that a carrier has trended forward instead of appraised, is out of step with the statute and leaves the association underinsured against its own reconstruction duty. Commission an independent replacement-cost appraisal, refresh it on the statutory 36-month cycle rather than letting the number drift, and confirm the master policy limit is written to that appraised replacement cost. Keep the appraisal and the policy declarations together in the renewal file, because carriers, lenders, and unit-sale reviews increasingly ask to see both.
Program notes
The dedicated community-association markets write Florida condominium property on replacement cost as standard, so an ACV master building policy on a Florida condo usually signals the account was placed in a generalist habitational package rather than a program built for the statute. The recurring friction point is the 36-month appraisal, not the coverage form; boards let the appraisal go stale and let the carrier trend the value, which is not what 718.111(11) contemplates.
How this evaluates
The Policy Checker applies these rules in order; the first match wins.
valuation method equals RCV -> Compliant: Replacement cost valuation is consistent with the adequate-insurance standard in Fla. Stat. 718.111(11). Confirm the limit is tied to an independent appraisal refreshed within the statutory 36-month cycle. valuation method equals ACV -> Gap: Actual cash value deducts depreciation and does not meet the replacement-cost basis Fla. Stat. 718.111(11) requires for a Florida condominium master policy.
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