Questions to ask yourself and insurance professionals when deciding on policies

FROM THE GRF

Golden Rain Foundation and the Mutual Boards continue to receive questions from GRF members regarding what specific adjustments should be made to their individual insurance policies as a result of the new master policy deductibles that have taken effect.

Unfortunately, it is challenging for GRF staff or GRF/Mutual directors to offer specific advice, as there are many variables that can affect the answer: individual policies, insurance company requirements specific to that company, Mutual requirements or recommendations in specific occupancy agreements, as well as the individual members’ level of risk tolerance.

However, we’re hoping that some broad, blanket suggestions on questions to ask yourself and your insurance professional will provide some needed clarity for residents.

The new master policies increased the deductible for GRF and the individual Mutuals as well in two areas: Property and liability. Both areas now have $100,000 as their deductible per claim, increased from the $50,000 deductible that our community had for many years.

This creates potential exposure for any member who becomes involved in a claim. If the master policy’s deductible has increased, members need to examine their individual policy limits to make sure that a gap is not created by this change.

For example, if a member’s insurance policy had a $300,000 limit before the change in the master policy, there was at worst $250,000 of personal coverage available; the worstcase scenario being that the $50,000 deductible is the sole responsibility of the individual shareholder. Today, since that deductible is $100,000—twice as much—the member now has only $200,000 in coverage available. If they need more coverage for their personal needs, they need to raise their policy limits.

Again, as the deductible exists for both property and liability (which are separate coverages), the prudent thing would be to examine your policy levels for both areas of coverage with your insurance carrier to determine if you have enough coverage for your personal needs in the event the entirety of the master deductible is your responsibility.

Many members have also approached us with questions about the limits on their loss assessment insurance. Loss assessment coverage is not something that has been impacted by the changes in the master policy, and there is no need to make modifications to your limits as a result.

Again, it is impossible for GRF staff or individual directors to provide individual and specifi c advice for every member’s situation. Our hope is that this information will provide some clarity for the needed conversation with your insurance provider.