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Maintenance Issue or Insurance Claim – Who Is Responsible to Repair or Pay?
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Minnesota Community Living November/December 2011

Maintenance Issue or Insurance Claim – Who Is Responsible to Repair or Pay?

By Tracey Lund, CIC, CISR, RJF Agencies

When repairs need to be made on association buildings, it is important for unit owners, board members and property managers to understand whether the unit owners or the insurance company are responsible for funding the work.

The association’s governing documents will help determine the maintenance and insurance responsibilities. The declaration section clarifies these responsibilities, and it is important for everyone to understand what is specifically defined as a maintenance or insurance responsibility.

Maintenance is defined as "work that is done regularly to keep a machine, building, or piece of equipment in good condition and working order.” The maintenance section of the declaration for ABC Association may state that "the unit owner is responsible for the maintenance of windows, decks, doors and exterior lighting.” Another association’s documents may say that "all maintenance of the units shall be the sole responsibility and expense of the owners.” Examples may include replacing old windows, rotting decking or corroded pipes from a leaking HVAC unit. In these cases, the unit owners often bear the responsibility to repair or replace the items if the damage is caused by normal wear and tear over time.

It is also important to understand the definitions of Common Elements and Limited Common Elements as they vary by declaration. Common Elements are items owned by the association for the benefit of all owners and occupants. Examples include garage stalls, storage lockers, community rooms and hallways. Limited Common Elements are those parts of the Common Elements reserved for the exclusive use of the owners and occupants of the units to which they are allocated. Examples include decks, patios, porches, balconies, shutters, doorsteps and chimneys. Your association’s declaration should be very specific about who is responsible to maintain these items: the unit owners or the association.

Keep in mind that even though some of the maintenance responsibility of Limited Common Elements may be on the unit owner, they would still be covered under the association’s master insurance policy in the event of a covered claim. 
Above all, the association must be compliant with the Minnesota Common Interest Ownership Act (MCIOA) when putting together its policy for division of maintenance responsibilities. Again, always refer to your association’s governing documents for clarification on who is responsible to maintain and insure what items. A common misunderstanding is that, while unit owners may be responsible for maintaining certain items inside or outside their units, it does not necessarily mean they are also responsible for insuring them.

Always consult with an experienced Community Association Insurance Agent to make sure your association has a comprehensive insurance program in place. Determining whether or not an agent has the Community Insurance and Risk Management Specialist (CIRMS) designation is a good way to evaluate their knowledge of and experience working with community associations.

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