SUMMARY (see disclaimer):
Become an Insurance Superhero: Cybersecurity & Coverage for Community Associations
The world of insurance and cybersecurity is evolving, and community associations must stay ahead to protect their assets, data, and members. In a recent livestream hosted by Ray Dickey, industry experts discussed the growing risks of cyber threats, liability concerns, and insurance renewal pitfalls.
Insurance Coverage: Common Mistakes to Avoid
Many associations expose themselves to risk due to these renewal mistakes:
– Failing to inform insurers about property improvements or maintenance.
– Overlooking changes in deductibles, limits, and exclusions.
– Assuming coverage remains unchanged year after year.
Today’s volatile market demands a proactive approach with so many urgent policy replacements due to non-renewals and insurer withdrawals, early renewal preparation is crucial.
Cybersecurity: A Growing Threat
Mike Novak of Hotwire Communications highlighted the increasing risk of cyberattacks. “Cybercriminals target those easiest to trick, and associations can be prime targets,” he warned.
To reduce risk, associations should:
– Train board members and managers to recognize phishing attempts.
– Use multi-factor authentication for added security.
– Secure sensitive data with proper cybersecurity measures.
Why Cyber Insurance Matters
Deborah Gerelli of Gerelli Insurance Agency emphasized that cyber insurance is an essential but often overlooked protection. “It can cost as little as $300 per year, yet many associations don’t carry it,” she noted. Given the financial fallout of a data breach, failing to obtain cyber coverage could be a fiduciary failure.
Cory Kravit of Kovitz Shifrin Nesbit reinforced this, adding, “If your association collects personal data—emails, financial records, online portal logins—you need your own protection, not just your management company’s policy.”
Key Policy Endorsements for Associations
Associations should ensure their policies include:
– Directors & Officers (D&O) Insurance – Protects board members from liability.
– Ordinance or Law Coverage – Covers legal code compliance costs after a loss.
– Umbrella Policies – Extends liability coverage beyond primary policies.
– Workers’ Compensation Coverage – Protects against risks related to volunteers and employees.
If your governing documents require specific coverage, failing to secure it could violate fiduciary duty.
Top Takeaways for Associations:
– Understand your coverage—read policies carefully and verify endorsements.
– Invest in cybersecurity—implement training and protection measures.
– Verify management insurance—don’t assume it covers your association.
Engage with experts—consult legal and insurance professionals.
Disclaimer: This content is provided for informational purposes only and does not constitute professional advice. It has been generated using the GoToWebinar system and assisted by artificial intelligence; therefore, accuracy is not guaranteed. Quotations included in the summary have been used with permission from the respective panelists. This summary is offered as a courtesy to highlight the significance of the discussed topic and encourage viewers to revisit the recorded livestream for full context. Always consult your legal, accounting, or other qualified professionals before making any decisions or taking action based on this content.