Determining the Required Coverage Amount

To the extent the master property insurance policy does not cover the interior or improvements of a unit in a project development, the borrower must maintain an individual property insurance policy.

The underwriter must verify the coverage amount is sufficient to restore the unit to its condition prior to a loss event.

Coverage sufficiency should be based on the best information known or available to the underwriter, which may include information obtained from the borrower, in collaboration with the insurer, the HOA’s legal documents, or other professional with appropriate resources to make such a determination.