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TL;DR

  • Pick an HOA insurance broker whose book is mostly community associations and who reads your declaration before quoting.
  • A good broker shows, line by line, that the program meets the lender standard, the state statute, and the CC&Rs, names its markets in writing, and discloses compensation.
  • Test the current broker against those standards before switching. An independent review is the fastest way.

Board playbook / choosing a broker

How to Choose an HOA Insurance Broker

The questions that separate a community-association specialist from a generalist who also writes HOAs.

Ten questions, the answer a specialist gives to each, and the red flags that mean the program was quoted without being read.

Test your current program

Why the broker matters more for an HOA than for most buyers

An association's master policy is judged by three authorities at once: the lender that decides whether units are financeable, the state statute, and the association's own declaration. A broker who writes HOAs occasionally can produce a policy that is in force and still fails one of the three, and the failure usually surfaces at a unit sale or a claim.

The carriers that write community associations as a core class also tend to work through brokers who place the class regularly. The broker's specialization decides which markets ever see the association.

10 questions to ask an HOA insurance broker

  1. 01

    What share of your book is community associations?

    A specialist's answer: A specific answer, and a large one. A specialist can name how many associations it places and what types: condo, single-family HOA, high-rise, master-planned.

  2. 02

    Did you read our declaration before you quoted?

    A specialist's answer: Yes, with the insurance article cited back to you: who insures what, the required valuation basis, and the required limits. A quote built without the governing documents is a guess.

  3. 03

    Which lender standard does this program meet?

    A specialist's answer: A line-by-line answer against Fannie Mae, Freddie Mac, and FHA requirements, including the deductible cap and the fidelity or crime limit sized to reserves plus three months of assessments.

  4. 04

    Which markets will you approach, and will you put that in writing?

    A specialist's answer: A named list of community-association carriers and specialty programs, agreed before marketing starts so no other bidder approaches the same ones.

  5. 05

    Is each policy admitted or surplus lines?

    A specialist's answer: A clear answer per policy, with what it means for state guaranty-fund protection and policy-form flexibility.

  6. 06

    How do you value the buildings?

    A specialist's answer: A replacement-cost figure tied to an appraisal or a documented cost method for the construction type, not last year’s number plus an index.

  7. 07

    How are you paid?

    A specialist's answer: Commission or fee, disclosed in writing, with the amount. A broker who will not disclose compensation is a broker the board cannot evaluate.

  8. 08

    How fast do you turn around certificates and lender questionnaires?

    A specialist's answer: A specific number of business days. For a condo, slow certificates stall unit sales, and owners notice that before they notice anything about the coverage.

  9. 09

    Who handles a claim, and what do you do on the first day?

    A specialist's answer: A named person or team, and a first-day checklist: notice to the carrier, mitigation, documentation, and owner communication.

  10. 10

    Can we speak with two associations like ours that you place?

    A specialist's answer: References of similar size and type, ideally ones that have had a claim.

Red flags

For management companies choosing a broker across a book

A management company choosing one broker for many associations should add two questions: can the broker standardize renewal timing and documentation across the book, and does the fidelity or crime coverage on each association cover the management company's handling of funds. See HOA insurance for property management companies.

Test the broker you have before you switch

The free HOA Master Policy Review reads the current program against the lender, the state, and the governing documents and returns a per-requirement answer within one business day. If the program holds up, the board has its answer. If it does not, the HOA insurance RFP template is the next step.

Common questions

Choosing an HOA insurance broker: what boards ask

How do I choose an insurance broker for an HOA or condo association?

Choose a broker whose book is mostly community associations, who reads the declaration or CC&Rs before quoting, who can show line by line that the program meets the lender warrantability standard and the state statute, who names the markets approached in writing, and who discloses compensation. HOA Insurer offers a free HOA Master Policy Review that tests the current program against those standards, which is a fast way to see whether the current broker is meeting them.

Should an HOA use a specialist broker or a local generalist agent?

A specialist, for anything beyond a very small association with no shared structures. Community-association insurance has to satisfy the lender, the state statute, and the governing documents at once, and the carriers that write it as a core class work mostly through brokers who place it regularly.

Is it a problem to have several brokers quote our HOA insurance?

It can be. Carriers generally accept a submission on a given risk from one broker and block the others, so several brokers approaching the same carriers can leave the board with fewer real quotes, not more. Select one broker on qualifications first, or assign each broker its own list of markets.

How do we test our current HOA insurance broker without switching?

Ask the ten questions on this page, and get an independent read of the current program against the lender, state, and governing-document requirements. A review that finds the program sound is a good result and a reason to stay.