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Cunningham Lindsey

Cunningham Lindsey. Jeff Corbin National General Adjuster. PROPERTY DESCRIPTION & COVERAGE INFORMATION. Sunset Shores HOA, Inc. – Consists of ten 2-story condominium buildings that house 4 units each. HOA policy limit is $300,000 per building Deductibles:

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Cunningham Lindsey

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  1. Cunningham Lindsey Jeff Corbin National General Adjuster

  2. PROPERTY DESCRIPTION & COVERAGE INFORMATION • Sunset Shores HOA, Inc. – Consists of ten 2-story condominium buildings that house 4 units each. • HOA policy limit is $300,000 per building • Deductibles: • All Other Perils Deductible $ 5,000 • Water Damage Deductible $10,000 • Named Storm Deductible 5% TIV per building subject to a minimum aggregate deductible of $50,000

  3. Problem #1 • Water heater burst in Unit D, migrates into Unit C, runs down into Units A&B. • There is no common element damage • Damages to Units as follows: • Unit D sustains $ 8,000 damage • Unit C sustains $ 4,000 damage • Unit B sustains $ 8,000 damage • Unit A sustains $20,000 damage • Total Damages: $40,000 damage No Unit Owner had any upgrades

  4. Problem #1 • Is there a paid claim under the HOA Policy? • If so, how much? • Using Master Deed #1 • Which unit owners are charge for the deficiency in insurance proceeds? (deductible) • What is the charge per unit? • Using Master Deed #2 • Which unit owners are charged with the deficiency in insurance proceeds? (deductible) • What is the charge per unit?

  5. SOLUTIONProblem #1 A. Yes, $30,000.00 B. All Unit Owners; $250 per unit C. Owners of the affected units as follows: Unit D $2,000 Unit C $1,000 Unit B $2,000 Unit A $5,000

  6. PROBLEM #2 Hurricane Tommy blows through the area causing damage to the roofs of three buildings with no interior damage. Damages are as follows: Building 1 roof $ 4,500 Building 3 roof $10,000 Building 9 roof $ 5,500 Total Damages $20,000 How much does the HOA pay? Who is responsible for the insufficiency in insurance proceeds under Master Deed #1? Who is responsible for the insufficiency in insurance proceeds under Master Deed #2?

  7. SOLUTIONProblem #2 • A. 0 – Gross loss is less than the minimum aggregate deductible of $50,000 for Named Storm. • B. 1) All Unit Owners 2) All Unit Owners – there is roof damage & roofs are common elements

  8. PROBLEM #3 Same storm scenario as #2, however all buildings sustained damage. All buildings sustained: Roof Damage $10,000 Siding Damage $ 5,000 Upstairs units sustained water damage in each building as follows: Unit D $ 2,000 Unit C $ 3,000 Total Damages $20,000 per building Overall for 10 buildings $200,000 total damages

  9. PROBLEM #3 • Assuming no recoverable depreciation is withheld, does the HOA policy have a paid claim? • If so, how much? • Who is responsible for the insufficiency in insurance proceeds under Master Deed #1? • How much does each party pay? • Who is responsible for the insufficiency in insurance proceeds under Master Deed #2? • How much does each party pay?

  10. A. Yes. $50,000 – 10 buildings 5% per TIV of $300,000 per building is applicable to whole loss resulting in a $15,000 deductible per building for total deductible of $150,000 B. 1) All Unit Owners 2) All Unit Owners pay $3,750 each 3) All Unit Owners will be responsible to some degree as to the $50,000 paid HOA claim goes toward the common element repairs 1st, leaving a deficiency of $100,000 toward common elements plus the additional $50,000 in interior damage. 4) Unit Owners without interior damage to units pay $2,500 ($100,000/40 units) Unit Owners of C Units pay $4,500 ($2,500 for common elements + $2,000 for interior) Unit Owners of D Units pay $5,500 ($2,500 for common elements + $3,000 for interior) SOLUTIONProblem #3

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