Insurance Coverage And General Liability

Am I as a board member under a duty of care to residents?

Generally speaking, an association’s board members owe a duty of care to the association.  However, acting in the best interests of the association likely includes taking commonsense measures to protect the health and safety of residents.  Duty of care will likely depend on the type of community your association oversees.  The question of duty of care is a delicate one that requires careful consideration of all legal and practical factors in play.  Thus, seeking legal counsel to definitely answer questions surrounding duty of care is advised.

Insurance Coverage and General Liability

Will insurance cover opening association amenities?

One of the first actions to take before deciding whether to open during COVID-19 is to review insurance policies covering a community’s facilities to determine how much liability will be incurred by opening.  Associations should make this decision only after seeking legal counsel because of the legal effects of policy language and potential liability incursion.

Should an association or property management company have volunteers enforce social distancing policies and ensure residents are wearing masks?

It depends.  The key question that arises here is incursion of liability, as each state has different laws and legal doctrines governing premises liability.

Is it advisable to hire professional services to clean common areas and amenities?

It depends on your potential liability exposure, which is an individualized assessment.  Having your own staff handle cleaning and maintenance may more advisable from a liability perspective, for example.  Generally speaking, however, should you decide to hire a third-party service, you should include an indemnification provision in the contract to minimize liability.  If you do not have such an agreement drafted, consult legal counsel to aid in drafting one.

Are board members protected if sued in their personal capacity?

This depends on the insurance policy.  This assumes there are no other issues with their coverage.  You should review your insurance policy, consult legal counsel, and determine the extent to which board members are personally covered.

If the board notifies all residents that one unit owner has COVID-19 and that unit owner sues for defamation, will the board be covered?

This depends on the insurance policy.  D&O policies typically require discussion with counsel before making a decision like this.  Accordingly, the law on defamation differs from state to state.  Thus, the board should consult legal counsel before notifying residents that one or more members of the community has COVID-19.

What can a management company do if a community manager contracts COVID-19 on the job?

There is the potential of coverage for workers compensation due to state executive orders.  For example, Kentucky has expanded the number of workers who can claim compensation due to exposure to COVID-19.  Each situation is unique, however, and management companies should seek the advice of counsel before taking action after a community manager contracts COVID-19.