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By CondoAssociation.com • March 29, 2018

At what point does HOA become over-insured? 

A couple of questions we need information on but first a description of what our HOA is like. We are quite small, only five homes at this time with two vacant lots that are for sale and have been for about 14 years now, we are located in Michigan. While I don't claim to be a doctor of any kind, I happened to run across an article about what "narcissistic personality's disorders" (narcissistic PD) are. This information was according to the article in Wikipedia. It describes our developer right to a tee! He
bullies all of the homeowners and controls the President and Treasure as if they were puppets on his strings. They will not act on anything without his opinion/approval.

We are having an issue now in that the developer brought it to the BOD's attention that there should be an insurance policy on the board to protect them from any possible legal action that may be brought against them. Our bylaws don't say that it is required but it does authorize that it can be put in place if necessary. This is creating some animosity amongst some of the officers as the ones against it feel that there is some unfinished business from a couple of years ago that the President and Treasurer are not willing to sit down with the Secretary and Vice President to agree upon and clear up. Is this insurance policy something that is needed? At what point do we become "over insured"? For a small HOA, I can see where our dues will be so expensive that our homes will be "unmarketable" if we continue to add to our financial liabilities. Let me add that the developer refuses to provide any proof of insurance for his vacant lots and Certificate of Insurance for the contractor he uses to maintain them. He says, "it is none of our business".

Secondly, what officer is supposed to keep all the records for the HOA? Our bylaws only state that the "seal" if we have one stays in the Secretary's possession. The reason for this question is that the developer took boxes of records to the Presidents house and according to the President, was told they were to stay with him and no one else. With that in mind, the President refuses to share any of the information with the Secretary or the Vice President. Again, this adds to the animosity amongst to homeowners and reinforces the statement I made in the beginning about the developer suffering from "narcissistic PD".

Any and all comments are well accepted in hopes of getting our issues resolved. Thank you.

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Please note that blog comments and postings are not legal advice, rather only the opinions of our readers.
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