HOA Lessons from Sanford, Florida
Since Trayvon Martin’s February 2012 death, HOA liability and neighborhood watch groups have become a bit of a hot button topic. Following Martin’s altercation with George Zimmerman in the Florida housing complex known as The Retreat, Martin’s parents initiated a wrongful death suit against the HOA. Reportedly, that lawsuit recently settled for approximately $1 million. Now, some HOA’s are rethinking risk management strategy and have taken a closer look at neighborhood watch groups in particular.
At its most basic level, an HOA is often comprised of a group of volunteers who oversee a housing development or condominium complex. HOAs are often responsible for maintenance of communal spaces including streets, pools, parks, and common areas. When accidents occur within a housing development, the victim often seeks recovery from the HOA. Accordingly, HOA insurance is a must.
Although most HOAs are legal entities set up for specific purposes, the HOA can still be held liable for accidents that occur on association-owned property. Liability may also extend to HOA members; i.e. the volunteers. Different types of coverage are available, most of which provide two primary sections: (a) coverage for individual members of the association and (b) coverage for assets owned by the HOA.
Some risk management tools available to HOAs include: hiring contractors who have their own liability insurance and requiring that homeowners using common areas for private functions to obtain liability insurance for those events, naming the association as an additional insured. However, HOAs that utilize a watch group are exposed to an extra layer of risk.
In the case of Martin, his family alleged that the HOA was responsible as a result of Zimmerman’s involvement in the Retreat’s neighborhood watch program. By some accounts, watch groups may be well intentioned but “can actually create more issues if volunteers go beyond simply reporting suspicious activity and instead take law enforcement into their own hands.” As a result, the experts suggest mitigating risks associated with watch groups by ensuring that the group has no “official connection to the HOA.”
The following risk management tools are recommended for those HOAs that maintain watch groups:
- Establish written guidelines for the group including procedures to react to suspicious activity;
- Contact the local police department for training; and
- Ensure that the watch group’s activity will be covered by the HOA insurance policy.