Subject: Special Board Meeting Regarding Home Insurance
Dear CHOA Members,
I trust this message finds you all in good health and spirits. I am writing to provide you with notice of a special board meeting, next Tuesday March 26 at 2:30pm, in Rec Hall C. I have called this meeting – with unanimous consent of the board – to discuss potential savings regarding the CHOA home insurance policy.
Recently, the CHOA board has engaged in discussions with State Farm regarding the potential adjustment of the owner deductible on our home insurance, proposing an increase from $10,000 to $25,000. After thorough evaluation, State Farm has indicated significant potential savings for our HOA. This adjustment will lead to reduced insurance costs for each CHOA member. Even if the owner’s personal insurance premiums increase slightly, the overall financial benefit is anticipated to be favorable for all. To be clear, your CHOA HOA insurance will go up this year regardless of what we do, but if we make the suggested change, it will go up less.
With the imminent renewal of our State Farm policy scheduled for March 29, it is paramount that we act swiftly to leverage any potential savings. Consequently, I have arranged for a concise special board meeting to be held next Tuesday at 2:30 PM. The meeting will take place via Zoom (https://pdx.zoom.us/j/81792034875), and in person at Rec Hall C.
I understand the short notice for this meeting and apologize for any inconvenience it may cause. However, the board unanimously agrees on the urgency of this decision to seize the opportunity presented. Your attendance and participation, along with any questions or concerns you may have, are highly encouraged as we endeavor to make a well-informed decision that serves the best interests of our community.
Thank you for your attention to this matter.
Warm regards,
Randy Hitz, CHOA President
2:30 in the afternoon is not necessarily at good time for a lot of homeowners. If this meeting is that important, why can’t it be schedule for 6:00p?
Hi Bubba,
Thanks for your question. You raise a good point. We’re always trying to find ways to get more people involved. We have 6:00 pm board meetings a couple times a year, but rarely does anyone outside the board show up. So, honestly, I did not even think of a 6:00 pm for this board meeting. My priority was to get a quorum of the board and their usual time to meet is on Tuesdays at 2:30 pm. If you have specific questions or concerns about the insurance, I’d be happy to talk with you.
Randy Hitz
Has any shopping around for a different company happened?
Contact Kyle Bunch..great insurance broker.
Hi Lana,
Thanks for your comment. The board has looked into other insurance providers. So far, we have not been able to find a provider that provides the same coverage we have now for a better price. One of the major issues is earthquake insurance. We are grandfathered in with State Farm so they must provide the coverage, other providers will not provide the coverage or are prohibitively expensive. Another problem is the number of claims (mostly water leak damage) which increases our costs with State Farm and turns other providers away. We may be able to get more competitive bids in the future if we can keep our claims down. Thanks again for sharing your comment. Please feel free to call me or stop by a future board meeting if you wish to discuss this further.
Randy Hitz
Hi Randy. Can you provider the other insurance companies the board has “looked into?” And what exactly is our coverage as a HOA and total cost? Is it necessary to have earthquake coverage? Is this something homeowners could vote on to have or not? Maybe it can be explained at the meeting why the homeowners should cover the increase of insurance costs due of ‘water leak damage’ that happened everywhere? It’s appears that our HOA insurance costs keep going up yet we still have a $10,000 deductible. What is it exactly that we get for paying for HOA insurance as a homeowner?
Janine,
Thanks for your questions. The board has a responsibility to address your questions and provide information. I
recommend you attend the meeting tomorrow where we will discuss this matter. If you cannot attend, let me know and I’ll
sit down and talk with you personally.
Randy
I recently left State. Farm for my auto, condo, and umbrella policies because their increases were insane. One State Farm agent tried to explain to me that all insurance companies were bleeding money due to the pandemic. I researched 5 or 6 other companies and all were up from previous years but none the percentage of State Farm. I wonder if it might be time to have an experienced insurance expert take a look and see if other firms might not be more competitive than State Farm.
Hi Tom,
Thanks for your comment. The board has looked into other insurance providers. So far, we have not been able to find a provider that provides the same coverage we have now for a better price. One of the major issues is earthquake insurance. We are grandfathered in with State Farm so they must provide the coverage, other providers will not provide the coverage or are prohibitively expensive. Another problem is the number of claims (mostly water leak damage) which increases our costs with State Farm and turns other providers away. We may be able to get more competitive bids in the future if we can keep our claims down. Thanks again for sharing your comment. Please feel free to call me or stop by a future board meeting if you wish to discuss this further.
Randy Hitz
Randy,
I feel it is important to keep the broken window coverage in place. I trust that the new changes will allow us to continue with this policy. I have had one broken window to date and a few close calls with others and appreciate having this type of coverage. None of the other HOA’s have this.
thanks,
Tim Bonino
Hi Tim,
Sorry to hear about your windows! Thanks for your question. We are not planning any changes in the broken window coverage.
Hello Randy,
The State Farm Insurance Company policies renew June 1, 2024. Why the sense of urgency? There is roughly 60 days until the renewal date which also provides ample time to obtain competitive quotes to use as a baseline for determining if the State Farm renewal quote is the best in terms of premium and scope of coverage. There are professional commercial insurance brokers/agents who specialize in providing HOA insurance for large scale HOAs such as ours. And they represent many insurance companies. You indicated earlier that the market had been approached in the past. When was the insurance market approached last and will those results be shared with the residents? If it has been more than a year since the HOA insurance market was approached, I recommend it is time to go to the market once again. The increase in the deductible from $10K to $25K is significant. And the premium will still increase. You indicated past losses are a factor in the premium increase. Are you able to share what our 5-year loss ratio is? Plus, the deductible increase in question excludes the earthquake insurance which has a separate 10% deductible usually applied per insured unit. I’ve spent the last 47 years in the commercial insurance industry in various roles, including as regional president/ceo of a major international insurance brokerage. I’m certain there are other residents in our HOA that have similar professional insurance backgrounds. Perhaps the board may wish to consider our consultation.
Thank You,
Claude Campbell
Hi Claude,
Thanks for your questions. The policy renews on March 29, thus the urgency.
You have a lot of questions and I think the best way for you to get your answers is to come to the board meeting tomorrow or to the
annual meeting on April 22. If you cannot do either meeting, I’ll be happy to sit down and talk with you and Steve Chinn and/or the State
Farm agent.
The State Farm policy shown on the CHOA website shows an expiration date of June 1, 2024. Therefore, the renewal date is the same.
Why is it being changed to March 29, 2024?
Thank you,
Claude,
We have to pay the bill on June 1 when the policy renews. As I understand it (and as an insurance expert, you understand this
better than I do) State Farm needs our requested changes by March 29 in order to determine the premium and bill us properly. You’re welcome to
talk with Steve Chinn or Jay Puppo if you need more information.