IMPORTANT FACTS REGARDING CONDO ASSOCIATIONS' INSURANCE RENEWAL

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I hope this message finds everyone in good health and joyful spirits before the Holiday Season. Reading about insurance is not always the most enjoyable thing, but every so often we feel compelled to reach out to the Village Residents and clear the air. Hopefully this communication is not too cumbersome.

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We have been working on the renewal policies for the Associations in Century Village West Palm Beach for the past 4 Months. As you may already know, Brown & Brown successfully proposed the best coverage terms and premium options against two well known competitors: “Insurance Office of America” and “Corporate Insurance Advisors”.

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As the Incumbent Agent for some 240 Associations in Century Village, we were able to improve the coverage terms when available, and the premiums when possible again this year.

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For the past few weeks, we have been aware of other Agencies meeting with Associations on an individual basis and sending around “Estimated Quotes”. They then ask for an Agent of Record letter to be signed on their behalf so that all of our hard work over the past 4 months can be assigned to them based on their “Estimations”.

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As you review these guessed premiums and coverage terms please consider the following:

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Property Insurance:

1. Ordinance & Law coverage that is in place for your Associations has been cut in half in the estimates:

The “Estimated Quotes” severely reduce the Ordinance & Law Coverage we have in place for the Associations. The coverage mentioned limit is only HALF OF THE ACTUAL COVERAGE. For a Building Insured for $1,500,000 Limit, the Ordinance & Law Coverage is REDUCED FROM $75,000 In Coverage TO $37,500 in Coverage. If you see a lower premium in the property quotes from estimates, you will know why.

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1. DUE TO CLAIM HISTORY IN PREVIOUS YEARS MANY ASSOCIATIONS IN CV-WPB ARE NOT ELIGIBLE FOR A $2,500 DEDUCTIBLE!

Either way, the difference in premium between a $2,500 Deductible and $5,000 Deductible is about $80 Per Association, Per Year! It’s not recommended to have such a low deductible for older buildings. The claims frequency will increase rates in future years.

1. The very large deductible that is of the highest concern for the association is the Hurricane Deductible. The other estimates DO NOT and CANNOT provide an option to reduce this deductible so that large assessments can be avoided following a Hurricane.

Liability Insurance:

• THE COVERAGE LIMIT APPLIES TO EACH ASSOCIATION ON A SEPARATE BASIS FOR BROWN & BROWN’S INSURANCE PROGRAM. THAT WAS THE CASE IN 2011, AND WILL BE THE CASE IN 2012.
• It is irresponsible and incorrect to suggest that the coverage limit is shared on our program. The insurance policy clearly states the application of separate limits for each Association.

Equipment Breakdown Insurance:

• Once again, the “Estimated” quotes being circulated around the Village also EXCLUDE this key coverage part. One guess is that this is so that the total premium can be made to look lower on their “estimates”.

Umbrella Policy:

• OUR UMBRELLA POLICY LIMIT ALSO APPLIES SEPARATELY TO ALL ASSOCIATIONS. IT IS NOT A SHARED LIMIT.
• The coverage limit offered in the “estimated” quotes distributed to associations provides a much lower coverage limit than that of our policy. In fact it is $10,000,000 less in coverage.

Directors & Officers Coverage:

• Our coverage form and deductibles are more beneficial. We will be happy to share the 5 page coverage comparison form that was provided to the Insurance and Bid Committees with you upon request.

Crime Policy:

• Coverage has been extended both in coverage limits, and coverage terms for the renewal.

As you compare our Proposals to the Estimated Guesses of others, please pay special attention what you’re being asked to give up. All in all, we believe you will still find our proposals to be more competitive in pricing when compared to any other available out there.

Please come see us at the UCO office during the week days so that we can address any questions in coverage forms, payment schedules, or premiums. We will continue our hard work for Century Village West Palm Beach.

Happy Holidays; and a Healthy 2012!

Ty Beba, CPCU, CIC, ARM, AIC

Executive Vice President

Brown & Brown-Palm Beach/Treasure Coast Division

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