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Maine Alliance for Road Associations

Liability Insurance Codes and Coverage

  • 07 Jul 2024 11:38 AM
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    Message # 13379040
    Anonymous member

    I've searched the discussion forum regarding liability insurance. Some posts are more than 10 years old. I'm wondering if there is more current information. This is what I've found:

    - The immunity the legislature provided is only for officers and directors carrying out the organizational processes of the association. It is not for road work. It does not protect officers or owners from liability for injuries due to improper road construction, maintenance or repairs.

    - Insurance companies use different coverage classification codes, e.g., #68500 & 73441 Townhouses & Condos, # 48727 Streets, Roads, Highways & Bridges. There's not a specific code for statutory road associations.

    - Typical coverage purchased is 1million each occurrence / 2million general aggregate.

    - Ad hoc road associations have the same immunity provided in the statute, but they cannot purchase liability insurance to cover injury.

    Is this still correct?

    What coverage & coverage classifications are recommended in 2024?

    My association has an insurance quote with coverage classification 68500 & 48727. We are individual properties and do not have a shared lot &/or building. Five or six lots of our 40 lots share access to a right-of-way. Those sharing the right-of-way have lake frontage.
  • 08 Jul 2024 6:19 PM
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    Reply # 13379555 on 13379040
    Anonymous member

    This is the first time to read about the coding information with insurance companies. Thank you for this information. Regretfully, I do not have much of a way to offer much help.

    We had one insurance plan over 5 years ago that charged us about $5000! So researching options, thanks to MARA discussions, we were about to get insurance for about $2000. Of course the price goes up each year.

    We have 70+ owners for our statutory road association. Due to this large number, causes us to have a high cost for premiums. We have 2 types of insurances: one for Officers and Board members and the other for "homeowners association" AKA our common roads. 

    I hope we can have an insurance service that serves just statutory road associations and not be branded under other types that are more costly.
  • 09 Jul 2024 6:20 PM
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    Reply # 13380040 on 13379040
    Anonymous member

    Can someone tell me how important liability insurance is for a small (12 owner) statutory road association?  What is the most likely problem to occur?  How much is a typical policy that would basically cover the Board and owners?

    Thanks
  • 28 Jul 2024 12:06 PM
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    Reply # 13387310 on 13379040
    Anonymous member

    Replying to Bob from July 9:

    Our 50-lot association has a general liability policy underwritten by Nautilus Insurance that costs $800/year. We have a directors and officers insurance policy from United States Insurance Group for $560/year.

    Our prices are probably higher than usual because we are trying to live down a lawsuit by one of our members in 2020. 

    Like others who have commented, I've found that insurers don't seem to know what to do with a statutory road association. You get put in the category of an condo association or homeowner's association. 

    I've also had trouble getting a straight answer as to whether all of our members are covered in the event of a lawsuit. If anyone has a policy that they know is covering all their members, I'd like to hear who is selling it. 
  • 29 Jul 2024 12:01 PM
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    Reply # 13387702 on 13379040
    Anonymous member

    We went through HB Insurance in Oakland for a policy quote. The road association liability policy covers claims for bodily injury and property loss. It includes investigation and legal defense if the entity is sued. The policy has a 1 million/occurrence, 2 million/general aggregate. The insurance company counts all lots benefitted by the road, including vacant lots. Our quote is for a 40 lot road association. It covers the road association, officers/board members and owners for $1,092. 

    Class codes are 68500 & 48727, with endorsement to cover lot owners.
  • 29 Jul 2024 12:07 PM
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    Reply # 13387706 on 13379040
    Anonymous member

    I've also learned since my original post that an association needs to be an entity in order to be covered. A statutory road association is an entity. An informal/ad hoc road association may be able to buy liability insurance, however, they will not know if the insurer considers them an entity until they make a claim.
  • 16 Oct 2024 11:11 AM
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    Reply # 13419630 on 13379040
    Anonymous member

    I am evaluating general liability and D&O insurance for our road association.  Would anyone know what are the ranges of reasonable rates fpr these policies?  Thank you

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