Umbrella / Excess Liability
What this clause says
The Association shall maintain umbrella or excess liability coverage sitting above the commercial general liability, non-owned auto, and directors and officers liability policies, providing additional limits on a follow-form basis for a single catastrophic claim.
What this means in plain English
An umbrella (or excess liability) policy sits above the primary general liability, hired and non-owned auto, and often D&O policies, adding a shared limit for a large claim that exhausts a primary policy. It is the efficient way to buy high total liability limits, because excess capacity costs far less per dollar than raising each primary policy. Umbrella limits for community associations commonly run in the $5M to $25M range depending on amenities, height, and unit count.
What it means for an HOA board
A serious injury claim at a pool, a playground, or a parking structure can exceed a $1M to $2M primary general liability limit, and without an umbrella the overage reaches the association through a special assessment. Confirm the umbrella follows form over the correct underlying policies, including hired and non-owned auto for communities whose staff or volunteers drive on association business, and that the total limit is sized to the community, not left at a legacy floor.
Program notes
Excess capacity is priced per layer, so raising the umbrella is usually the cheapest way to add total liability protection. Confirm the schedule of underlying policies is complete, since an umbrella only follows form over policies actually listed.
How this evaluates
The Policy Checker applies these rules in order; the first match wins.
umbrella limit is at least $5M -> Compliant: An umbrella at or above the $5M to $25M community-association range gives meaningful catastrophic-claim protection above the primary limits. umbrella limit is at least $1 -> Borderline: An umbrella is present but may be thin for the community size. Confirm it follows form over GL, non-owned auto, and D&O, and that the limit fits the amenities.
See this in your policy
Check this clause against your master policy.
Run the Policy Checker