Condo Association Management Blog

In Massachusetts, the condominium act requires fiedlity insruance for 3 months of assessements minimum. 
 
 
 
Stephen Marcus 
 
Marcus Errico Emmer & Brooks 
 
781.843.5000

In Florida is not required but is highly recommend to have Fidelity Bond

FHA and FNMA (Fannie Mae) are now both requiring fidelity bonds. FHA requires 3 months of assessments PLUS reserve funds be covered. Fannie Mae, in my understanding, is requiring covering 3 months of assessments. The average price for a five member board for $100,000 worth of coverage is about $300 or so dollars. I don't know what kind of deductible that is - i think $1,000. 
 
Check with your insurance agent and legal counsel.

How about the laws for the state of Texas? Anyone know if a Fidelity Bond is a requirement by law? Help!  
 
Thanks

Are condo's in new york state required by law to carry a fidelity bond?

What can a person do if the HOA refuses to get a fidelity bond. I am unable to close on the sale of my condo because my hoa will not comply with the required fidelity bond. My condo is located in NYC. Help Please!!!

Is Fidelity Insurance required for the State of DE Condos and what is the required amount?

I also am unable to sell in Arizona because my HOA has employee dishonesty insurance, but Fannie Mae says we need fidelity bond. What's the difference?

What can a person do if the HOA refuses to get a fidelity bond. I am unable to close on the sale of my condo because my hoa will not comply with the required fidelity bond. My condo is located in NYC. Help Please!!! What was the answer to this question? Thank you!

The problem is that Fidelity Bond and Fidelity Insurance are two completely different things even though both provide protection against losses due to employee dishonesty. One is a guarantee and the other is an indemnity contract. The bond grantees the loss but has an indemnity agreement which the Condo. Association will have to make good in case the bond is used. The insurance indemnifies against the loss in exchange of a pre-paid premium and no indemnity from the Condo. Association is enforced. The bond costs 2% of the limit while the insurance could range anywhere from $150 to $300 depending on the limit. 
The HUD Mortgagee Memorandum 2009-46B dated Nov. 2009 list either Fidelity Bond/Fidelity Insurance as a requirement.  
Hence, the question is: Is either one OK to comply with the requirements? 
Anyone has an answer to this?

FL it is mandatory to have fidelity bonding in place - you need to read the FL state statutes before you post wrong information

Our HOA does not have a Fidelity bond in place. California 
 
What does the law require here?

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This may help some of you, alot of times the HOA communities don't have employees so they don't have a fidelity bond. But they contract a management co to run the HOA so essentially that is their "employee", you would call the management co and ask for the fidelity bond or employee dishonest policy for themselves not for the HOA. Hope that helps.