What is general liability insurance?

General liability insurance (GL) is fundamental coverage that helps protect your community association from third-party claims alleging personal injury, bodily injury, or property damage. This coverage is a financial safety net that can shield your community from serious legal and financial consequences.
A General Liability policy will provide a full spectrum of customized coverages required for communities such as:

1. Coverage against third-party claims made by:

   Should any of these parties allege that your community’s negligence caused injury or property damage, your general liability policy would come into play.

• Residents
• Guests
• Vendors
• Passers by

2. Coverage for daily activities

   Even your community’s day-to-day operations can sometimes lead to unexpected incidents. These include:

• Maintenance and repairs
• Landscaping activities
• Community events
• Use of common areas and amenities (swimming pools, gyms, clubhouses, and more)

3. Coverage for legal defense and settlement costs

   General liability insurance also includes coverage for legal defense costs. In a lawsuit, this coverage pays for the attorney fees to defend allegations and the cost of settlement or judgment.
   
   If a settlement is reached or a judgment is entered against your community, this coverage can cover these costs up to the specified limits. This protection allows your community to focus on its core responsibilities without the threat of financial ruin due to a liability claim.

Real-life general liability claims examples

• Slip and fall on community property

  Scenario: A resident slips on a wet floor in the community clubhouse, resulting in a broken hip that requires surgery.
  
  GL Policy response: The policy would cover the cost of legal defense if the resident files a lawsuit. If the association is found liable, general liability insurance would cover the legal defense and any potential settlement up to the specified limits.
   

• Community named in large bodily injury claim

  Scenario: A landscaping company contracted by the community accidentally drops a large tree branch, severely injuring a resident. The resident files a lawsuit naming both the landscaping company and the association as defendants.
  
  GL Policy response: Even though the primary negligence lies with the vendor, the community is named in the suit. General liability insurance would provide legal defense for the community and cover any potential settlement or judgment costs allocated to the community up to the specified limits.

Why should your community invest in General Liability insurance?

• Financial Protection: Without adequate coverage, a single large claim could reduce your community’s reserves or require special assessments, which are additional fees charged to homeowners to cover unexpected expenses.
• Peace of mind: Proper insurance coverage allows board members and property managers to focus on their primary responsibilities without constant worry about potential lawsuits.
• Contractual Compliance: Many contracts, including those with vendors or lenders, require communities to maintain General Liability Insurance.
• Resident Confidence: Having comprehensive insurance coverage demonstrates responsible management, which can be appealing to current and prospective residents when referring to property value.

Tailoring your community’s policy

Every community is unique. We can help you customize your policy to fit your specific needs, requirements and best practices including:

• Location and size
• Amenities and features
• Claims history
• Risk management practices

Invest in your community's protection with FS Insurance Brokers

Our team at FS Insurance Brokers is committed to providing you with comprehensive General Liability solutions tailored to your community's unique needs. Our longstanding commitment to education, risk mitigation, and claims control allows us to create superior General Liability programs with coverage at competitive, needs-based rates. We understand the specific risks faced by HOAs and COAs, and our expertise ensures that your community is protected against a wide range of potential liabilities.

Contact our team today to learn how our general liability insurance solutions can protect your community from unforeseen risks, legal challenges, and financial setbacks.