CooperatorNews New York 2022

August 2022
COOPERATORNEWS.COM
determining who pays for an insurance claim “is a huge question. The
determination of who pays for what is based on two different factors:
the state in which you are located, and the governing documents that
are in place. That’s what dictates who pays for what.” He goes on to ex-
plain that there are three different ways to insure in multifamily build-
ings: One is ‘bare walls,’ meaning the association will cover everything
up to unfinished interior surfaces. The second is called ‘single entity’
(also known as ‘original specifications’). That means the association
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Insurance coverage and the inevitable claims that coverage defends against are a fact of life
for multifamily residential communities. In that setting, it’s critical for all parties to understand
whose policy covers what, and under what circumstances. A good starting point is to view li-
ability and claims from the perspective of that unique factor for condo and co-op living: shared
common areas versus areas for the exclusive use of individual shareholders or owners and their
families.
Yours, Mine, Ours
Alex Seaman is a senior vice president of HUB International, a national insurance broker-
age headquartered in Chicago with offices throughout the United States. Seaman is located
in Woodbury, New York. “An association policy is intended to provide coverage for common
areas, including [physical] structures and common elements,” he says. “These elements are de-
fined by the bylaws and/or proprietary lease. Common elements can differ from one property
to another.”
According to Ryan Fleming, a director with JGS Insurance, a national brokerage with of-
fices throughout the United States, including Holmdel, New Jersey, where Fleming is based,
The 347,000 planned communities in the
United States—a number that includes co-
operatives, condominiums, and homeown-
ers associations—are generally governed by
volunteer members of the building or com-
munity elected by their fellow unit owners
or shareholders. There are no requirements
or prerequisites for serving on a board, other
than what might be specified in the govern-
ing documents of a particular community—
usually status as a member in good standing
and a minimum age, for example.
While having a professional history or
other relevant experience in a field like ar-
chitecture, accounting, law, interior design,
engineering, or urban planning might be
useful on a board, these skill sets do not
necessarily “qualify” someone to be a direc-
tor. All it takes is a willingness to essentially
run a multimillion-dollar nonprofit for zero
pay, little recognition, and fair-to-high like-
lihood of being confronted by at least one
irate neighbor at some point (and probably
more than once) in one’s tenure.
So what separates a good board from the
stereotypically despotic and dysfunctional
ones, or even a mediocre one? We spoke to
professionals in several fields who regularly
work with multifamily boards to get their
perspectives and offer some insight into
what makes the best boards best.
Respectful Interaction
While there are no prerequisite degrees
At the heart of co-op and condo living
is the association or corporation board, that
unique self-governing body that directs the
community and carries out its mission to
uphold quality of life and preserve the in-
vestment of its members. Board service is
almost universally voluntary, and does not
require any specific experience. It’s a learn-
on-the-job situation.
Given that, and given that board mem-
bers have a fiduciary duty to their commu-
nity, what kind of orientation or onboard-
ing should boards offer to new members
to help them understand the scope of their
responsibilities and make sure they’re well
equipped to fulfill them?
Welcome!
Andy Marks is a senior vice president
with Maxwell-Kates Inc. and Associa Com-
pany, management firms based in New York
City, and was also the president of his Man-
hattan co-op for many years. According to
him, “When we have a new board member
who is unfamiliar with what’s required of
them, we first provide them with a basic
overview of the following: We start with the
difference in structure and status between
a co-op (where owners are shareholders
of the corporation) and a condominium
(in which unit owners own real property,
each with a proportionate share of the com-
mon interest). Although that is something
they may already be familiar with, it helps
ground them.
“Then we move on to basic roles and re-
sponsibilities of the board and each board
member,” he continues. “Next, we intro-
duce the specific issues currently being
addressed, along with the short-term and
long-term objectives of the board they are
joining. This update will come from the
board president and/or the property man-
ager. Finally, we introduce the expectations
Insurance in the
Multifamily Setting
Knowing Who Covers What is Key
BY A. J. SIDRANSKY
Who’s a Good
Board?
Pros Weigh in on Co-op,
Condo, HOA Leadership
BY DARCEY GERSTEIN
Onboarding New
Board Members
Getting Newcomers
Up to Speed
A. J. SIDRANSKY
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