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MCL May/June 2014 - Melding the Bi-Annual Walk-Around
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Melding the Bi-Annual Walk-Around with the Insurance Claim Process

by Herman Fassbender, Marsh & McLennan Agency

Reprinted from CIC Midwest News, Winter 2012, used with permission.

Initially the concept of a bi-annual walk-around and the handling of the exterior claims process appear to have little in common, but upon further investigation, a whole different relationship emerges that, when put into practice, will bring a significant value to the association.

Three specific reasons surface for pre-establishing a relationship with a competent exterior contractor:

  1. The exterior contractor should be used to inspect the property twice a year in conjunction with the spring and fall walk-around. This process should include walking all roofs, making minor repairs to loose shingles, carefully inspecting possible problem areas of the roof, and calking where needed to prevent nuisance water claims. Siding should also be inspected, making minor repairs as they become apparent. Calking along exterior openings is critical as they may have dried out over the season and this a very inexpensive fix when caught early.

  2. Part of the contractor’s inspection should also involve looking for possible storm damage that may not have been previously noted. This is particularly important if the association chooses to move the insurance package from one carrier to another. Unreported damage sustained in prior months (or years) may become a hot issue especially if combined with current damage. Sorting out “when the damage occurred” is a hassle and time consuming. This can easily be minimized through recurring inspections by a trusted and competent exterior contractor, who keeps good service records of each inspection.

  3. Staying ahead of the game after a catastrophic loss is of utmost importance. A pre-established relationship with an exterior contractor will hasten that process. Your chosen contractor will meet with the claims adjustor from the beginning, gather an agreed-upon scope of work report, and organize materials and labor before costs skyrocket (which they will after a CAT loss). You will be first on the list to get repairs done, not the one waiting months because materials and labor are backed up.
    Keep in mind that exterior contractors will probably charge for the semi-annual inspections on a time and materials basis. Though association budgets are normally tight, the rate of return for this financial outlay is exponential when all aspects are considered (i.e., increased longevity of the roofs, saved time and unit owner disruption by reducing water infiltration property damage, reduced future insurance costs for not having to submit these water damage claims).

Speaking of budgets, an added benefit of developing a relationship with a trusted exterior contractor is they can update the Board periodically on the life expectancy of the existing exterior components, so the association can properly set its reserves, but this is a topic for a whole other article.

In the end, developing a relationship with a competent exterior contractor is a must for all associations. If you have not already done so, begin acquiring referrals from trusted advisors such as attorneys, insurance providers, property managers, other association boards or association industry organizations. Interview a minimum of three companies, finding out their areas of expertise. Verify that they are well versed in the handling of insurance claim work. Get names of other associations they have worked with in the past. Your advance leg work is definitely worth your time. Look at this relationship as a long term one, which should span many years.

Pre-establishing a relationship with a competent exterior contractor, who will look after the integrity of your association’s exterior, will pay many long term returns indeed.

Published by Community Associations Institute — Minnesota Chapter, copyright 2013. All articles and paid advertising represent the opinions of authors and advertisers and not necessarily the opinion of either Minnesota Community Living or CAI–Minnesota Chapter. The information contained within should not be construed as a recommendation for any course of action regarding financial, legal, accounting, or other professional services by the CAI–Minnesota Chapter, or by Minnesota Community Living, or its authors. Articles, letters to the editor, and advertising may be sent to Monte Abeler at, or at CAI–Minnesota Chapter, 1000 Westgate Dr., Suite 252, St. Paul, MN 55114.

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