When taking out an insurance policy, attention should
be paid to the coverage, terms and conditions of the policy.
A reputable insurance company should be chosen. To attain
the best value and secure the greatest insurance coverage
with the most reasonable premium, quotations from a number
of reliable insurance companies should be compared before
effecting any insurance policy.
If insurance is arranged by the property manager, the
policy should be taken out by the owners' corporation
(OC) or Mutual Aid Committee (MAC) jointly with the manager. Buildings with OCs shall take out the policy of Third Party Risks Insurance in the name of the OC.
After the policy has come into effect, a copy should
be obtained from the property manager.
Information given to the insurance company must be accurate.
Failure to do so may render the insurance policy void
and indemnity may not be paid.
An appropriate level of coverage and sum insured, for
example -
Property-All-Risks Insurance - the amount should
be able to cover the current cost of repairing the
common parts or replacing the common properties
of the building.
Third Party Risks Insurance - the amount of coverage
is usually determined on the basis of the highest
compensation payable for a single accident. Generally
speaking, a larger building or a building with greater
pedestrian flow requires a higher amount of coverage.
Employees' Compensation Insurance - the amount
of coverage should usually be determined on the
basis of the total annual income of all the employees,
including salaries, double pay, bonus, allowance,
cash award, etc.
The OC should review the amount insured for various
types of insurance for the building annually.
The OC should make available for inspection by owners and relevant parties the insurance policy and receipt of the latest premium.
In case of any accidents, the insurance company must be informed immediately in accordance with the policy requirements.
