IN SHORT: THE ALLOCATION, PLAINLY
- • Florida Statute § 718.111(11) draws the line: the master policy insures the structure "as originally installed" and common elements; the unit owner’s HO-6 insures everything installed inside the unit.
- • The master-policy hurricane deductible (often 2% to 5% of the insured value) passes through to owners as a special assessment. Loss-assessment coverage on each HO-6 is what absorbs an owner’s share.
- • The default loss-assessment limit is often just $1,000, nearly useless against a multimillion-dollar building’s deductible. Coastal owners commonly raise it to $10,000 or more.
- • A board has a fiduciary duty to pursue the association’s claim reasonably: document, notice promptly, and don’t accept a lowball that pushes cost onto owners.
- • Post-Surfside reforms (SB 4-D and later laws) changed reserve and structural-integrity obligations. Confirm the current law and your governing documents with counsel.
Master policy vs. unit owner, who insures what
The full statutory breakdown, including the deductible pass-through, loss-assessment mechanics, and the post-Surfside reserve laws, is in condo & HOA claims. The broader commercial hub covers other association property types, and business interruption applies to income-producing association facilities.
Four things a board owes its owners
Notice the claim promptly and in writing
The association’s notice obligation runs on the master policy’s terms. Document the date of loss and give written notice; keep a claim log of every carrier contact.
Document common-element and structural damage
Photograph and video the roof, envelope, and common areas before mitigation. The same evidence standard that wins a homeowner’s claim wins the association’s.
Understand the deductible before you assess
A 2% to 5% hurricane deductible on a large building is a six- or seven-figure number that becomes a special assessment. Owners will ask how it was calculated. Know the answer.
Don’t accept a lowball that shifts cost to owners
A board’s fiduciary duty includes pursuing the master-policy claim reasonably. An underpaid association claim becomes a larger special assessment on every owner.
An underpaid association claim is a bigger assessment
Every dollar the master-policy carrier underpays is a dollar the association funds through a special assessment on owners. That is what makes an association coverage dispute different from a single-family one. The fiduciary stakes multiply across every unit. When the carrier denies, disputes causation on the structure, or pays below the documented scope, the board should get a coverage read before it assesses owners.
A free attorney case review is available. Reserve, structural-integrity, and governing-document questions arising from the post-Surfside reforms are legal questions too. The statutes summarized here are general, so confirm the current law and your association’s documents with counsel.
For condo & HOA managers, FAQ
Who pays for hurricane damage in a condo, the association or the unit owner?
Both, split by Florida Statute § 718.111(11). The association master policy insures the structure "as originally installed", roof, exterior and load-bearing walls, the building envelope, and common elements. The unit owner’s HO-6 insures everything installed inside the unit: floor, wall, and ceiling coverings, cabinets, appliances, water heaters, window treatments, personal property, and betterments. When a hurricane damages both, both policies respond, and the coordination between them is where disputes arise. Our condo & HOA claims guide walks the full allocation.
What is the deductible pass-through and how does it become a special assessment?
A Florida master policy typically carries a percentage hurricane deductible, often 2% to 5% of the insured value, which on a large building is a very large number. The association is responsible for that deductible, and it funds it (in whole or part) by levying a special assessment on unit owners. Each owner’s HO-6 loss-assessment coverage is designed to absorb their share, but only up to the limit on that policy, which is why the default $1,000 limit is often dangerously low.
What is loss-assessment coverage and what limit should owners carry?
Loss-assessment coverage is an HO-6 add-on that pays a unit owner’s share of a special assessment for a covered common-area loss, including the master-policy hurricane deductible passed through. The default limit is frequently just $1,000, which is nearly useless against a multimillion-dollar building’s deductible. Coastal owners commonly raise it to $10,000 or more. This is general information, not advice for a specific policy. Owners should confirm terms with their agent.
When should a board bring in an attorney?
When the master-policy carrier denies or underpays the association’s claim, disputes causation on the structure, or delays past the deadlines, the board is looking at a coverage dispute with fiduciary consequences for every owner. That is the point to get a free attorney case review. Reserve, structural-integrity, and governing-document questions from the post-Surfside reforms are also legal questions. Confirm the current law with counsel.
- Fla. Stat. § 718.111(11), condominium insurance ↗, The master-policy / unit-owner allocation and the primary-coverage rule.
- Fla. Stat. § 627.70132, notice of property insurance claim ↗, Notice and supplemental-claim deadlines that apply to the association’s claim.
- Fla. Stat. § 624.155, civil remedy (bad faith) ↗, The statutory path when the master-policy carrier’s handling crosses into bad faith.
- S.C. Code Title 38, Chapter 59, improper claim practices ↗, South Carolina claim-handling standards for association claims.
Not legal advice; consult an attorney about your specific claim. Confirm the current law and your governing documents with an attorney before acting.
Master-policy carrier denied or underpaid the building?
Send the master policy, the denial or estimate, and the damage documentation. The firm gives a straight read on the association’s coverage position, before the board assesses owners for the gap.
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