Loss assessment coverage is defined by the International Risk Management Institute (IRMI) online glossary as:

A property owner’s share of a loss to property owned in common by all members of a property owners association. Homeowners policies and condominium unit owners policies typically provide a small amount of coverage for such assessments, with additional amounts available by endorsement for an additional premium.

This definition is pretty self-explanatory. The declaration page for your home or condo unit owner insurance policy will typically outline the amount of loss assessment coverage you have but even if you don’t see it listed there, it may be referenced at a basic amount within the policy itself or the “checklist of coverage”. An important factor of note is that the loss assessment claim is not typically subject to the hurricane deductible so whereas you may have had some damage to your home, but not enough to meet your hurricane deductible (typically 2% of the dwelling coverage for a single family home), the loss assessment coverage is usually subject to the specified deductible in the policy or the “all other peril” deductible – depending on the type of policy and other details. It’s not uncommon for this deductible to be as little as $0, $250 or $1000, so if you receive a formal notice of special assessment from your master or sub-association, be sure to address this with your agent or insurance company. The adjuster/company will determine the final applicability of coverage but, in general, IRMA damage to common property is the type of event for which loss assessment coverage is designed to respond.

If you’d like more information or to discuss your situation further, please contact Matt Nance at our agency. CONTACT US HERE