Recent History: Kaimala Marina has consistently maintained property insurance in accordance with applicable statutes while balancing responsibility and cost to the Association. Individual owners were held responsible for the damages to their areas and the AOAO focused in insuring defined common areas and the parts of the property that were not the control of an individual homeowner. This included holding individual homeowners responsible for damage to adjacent units when a failure in their unit caused the damage, the most common situations arising from issues with plumbing. This practice by the AOAO minimized the claims made against the Association’s property insurance and helped to keep the premiums from escalating. It is necessary to modify this practice in order to comply with Hawaii’s condominium statute [both HRS §514A and §514B].
What It Means: The Hawaii statute, as well as our project documents require that the Association’s property insurance policy provide coverage for the buildings as originally built, inside and out, at today’s replacement cost. Individual unit owners are responsible for insuring any upgrades made to the unit [e.g. hardwood floors, upgraded cabinets, appliances, etc.] as well as their own contents, loss of use or loss of rents, and personal liability. Even though individual owners have some responsibilities, it is likely that the Association will have some financial responsibility particularly if the damage is extensive. If the number of claims grow, so will the Association’s insurance premiums. Given that, it is in everyone’s best interest to prevent as many of these catastrophic incidents as possible.