Insurance Disclosures

An association is required to prepare and distribute to its members an annual budget report pursuant to Civil Code Section 5300 not less then thirty (30) nor more than ninety (90) days prior to the beginning of the association’s fiscal year. (See “Annual Budget Report.”) One of the items of information that must be included in the annual budget report is a disclosure summarizing the association’s property, general liability, earthquake, flood, and fidelity insurance policies. (Civ. Code § 5300(b)(9).)

Required Contents of Insurance Summary
The insurance summary must include information pertaining to each policy of insurance carried by the association, as well as the statement required by Civil Code Section 5300(b)(9).

  • Information Pertaining to Insurance Policies – For each policy of insurance carried by the association, the summary must include all of the following: the name of the insurer, the type of insurance, the policy limit, and the amount of the deductible (if any). (Civ. Code § 5300(b)(9).)
  • Required Insurance Statement – The insurance summary must also include the following statement in at least 10-point boldface type:

“This summary of the association’s policies of insurance provides only certain information, as required by Section 5300 of the Civil Code, and should not be considered a substitute for the complete policy terms and conditions contained in the actual policies of insurance. Any association member may, upon request and provision of reasonable notice, review the association’s insurance policies and, upon request and payment of reasonable duplication charges, obtain copies of those policies. Although the association maintains the policies of insurance specified in this summary, the association’s policies of insurance may not cover your property, including personal property or real property improvements to or around your dwelling, or personal injuries or other losses that occur within or around your dwelling. Even if a loss is covered, you may nevertheless be responsible for paying all or a portion of any deductible that applies. Association members should consult with their individual insurance broker or agent for appropriate additional coverage.” (Civ. Code § 5300(b)(9).)

Notice of Change in Insurance Coverage
Civil Code Section 5810 requires an association to provide its members with individual notice if any of the insurance policies described in the annual budget report have been changed, lapsed, been canceled, are not renewed. (See “Notice of Change in Insurance Coverage.”)