Question Our family is moving to a new housing development that has a homeowners association. I know we have to join and pay dues, but what does the HOA do in return?
Joel Brekken is a Farmers Insurance® agent in Duluth, Minnesota. He explains how HOAs work and the tasks they may handle for residents.
Answer In general, homeowners associations govern residential communities like condos, townhouses and single-family developments. Anyone who buys a home in the community must agree to certain rules, usually called covenants, established by the HOA. Covenants vary from community to community. But generally, they are designed to take care of a development’s upkeep, appearance and safety. Homeowners pay monthly dues to the HOA to cover its costs.
If you live in a condo , the HOA is usually responsible for maintaining and insuring the building’s exterior and grounds, as well as common areas like the roads, clubhouse or gym. When it comes to insuring your individual unit, start by checking with the HOA to see what its master insurance policy covers. Some master policies cover only the building structure — exterior walls, roof and foundation. Others may also cover flooring, fixtures and interior walls inside your unit. I typically review the master policy with my customers to help them understand what’s covered and what’s not. At a minimum, condo owners are responsible for insuring their personal property — things like furniture, clothing and household items.
If you live in a development of single-family homes, the HOA usually maintains community features like a pool, walking trail or playground and obtains insurance covering them. The homeowners are responsible for insuring their own homes, inside and out, and property.
Most HOAs, whether for condos or single-family homes, set rules for occupancy issues like pets, design choices like paint colors and landscaping, and for the upkeep of individual residences.
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