One of the largest line items in any condominium association’s budget is its insurance premium. Condominium associations are required, pursuant to their governing documents, to carry adequate property insurance to address common elements (and in many cases, unit owners’ improvements), liability insurance, and director’s and officer’s insurance coverage. Further, condominium associations budget for any insurance claims that may trigger the need to meet an insurance deductible. That deductible may be $10K per claim.

An individual condominium association cannot always singularly address the premium rates because the insurance carrier has to take into consideration its claims history. The claims history includes all of the geographic areas where its insureds are located. Also, there is legislation pending that may impact an individual condominium associations’ ability to recoup insurance deductibles paid as the result of an insurance claim.

Assemblyman Dan Benson (D-Mercer County) is the sponsor of Assembly Bill A3683 that when revised (preliminary discussions with the Assemblyman regarding these revisions have been positive), may allow a charge-back to be billed to the owner, or owners, deemed to have caused the loss. These revisions would allow such a “charge-back” to owners deemed to have been negligent in their actions or inactions that were the proximate cause of the loss that triggered the insurance deductible.

CAI-NJ (, the local chapter of the Community Associations Institute, is working closely with Assemblyman Benson to move Assembly Bill A3683. I serve on CAI-NJ’s Legislative Action Committee and am working closely with Assemblyman Benson on this bill.

As I write this article, the A3683 bill is pending before the Assembly Housing and Community Development Committee.

Please feel free to contact the author of this blog for more information, or if you have any questions.