Verbatim from the public record. The law itself is a government work — always confirm the current version on the official source before you rely on it.
����� 1. Commencing not later than the time of
the first conveyance of a unit to a person other than a declarant, the
association shall maintain, to the extent reasonably available and subject to
reasonable deductibles, all of the following:
����� (a) Property insurance on the common elements
and, in a planned community, also on property that must become common elements,
insuring against risks of direct physical loss commonly insured against, which
insurance, after application of any deductibles, must be not less than 80
percent of the actual cash value of the insured property at the time the
insurance is purchased and at each renewal date, exclusive of land,
excavations, foundations and other items normally excluded from property
policies.
����� (b) Commercial general liability insurance,
including insurance for medical payments, in an amount determined by the
executive board but not less than any amount specified in the declaration,
covering all occurrences commonly insured against for bodily injury and
property damage arising out of or in connection with the use, ownership, or
maintenance of the common elements and, in cooperatives, also of all units.
����� (c) Crime insurance which includes coverage for
dishonest acts by members of the executive board and the officers, employees,
agents, directors and volunteers of the association and which extends coverage
to any business entity that acts as the community manager of the association
and the employees of that entity. Such insurance may not contain a conviction
requirement, and the minimum amount of the policy must be not less than an
amount equal to 3 months of aggregate assessments on all units plus reserve
funds or $5,000,000, whichever is less.
����� (d) Directors and officers insurance that is a
nonprofit organization errors and omissions policy in a minimum aggregate
amount of not less than $1,000,000 naming the association as the owner and the
named insured. The coverage must extend to the members of the executive board
and the officers, employees, agents, directors and volunteers of the
association and to the community manager of the association and any employees
thereof while acting as agents as insured persons under the policy terms.
Coverage must be subject to the terms listed in the declaration.
����� 2. Except as otherwise provided in
subsection 3, in the case of a building that contains units divided by
horizontal boundaries described in the declaration, or vertical boundaries that
comprise common walls between units, the insurance maintained under paragraph
(a) of subsection 1, to the extent reasonably available, must include the
units, but need not include improvements and betterments installed by units�
owners.
����� 3. The provisions of subsection 2 do not
apply to property insurance maintained by an association under paragraph (a) of
subsection 1 which covers the peril of wildfire and which coordinates with or
subrogates individual policies of property insurance maintained by units�
owners that cover the peril of wildfire. The provisions of this subsection do
not relieve an association from compliance with any other provision of this
chapter.
����� 4. If the insurance described in
subsections 1 and 2 is not reasonably available, the association promptly shall
cause notice of that fact to be given to all units� owners. The declaration may
require the association to carry any other insurance, and the association may
carry any other insurance it considers appropriate to protect the association
or the units� owners.
����� 5. An insurance policy issued to the
association does not prevent a unit�s owner from obtaining insurance for the
unit�s owner�s own benefit.