Chapter 9

Pursuant to the Condominium Act, in what period is the association required to provide a Certificate of Insurance to a member? a. 15 days b. 30 days c. 10 working days d. 7 working days

a. 15 days

Reinsurance: a. Enables a primary insurer to transfer part of the risk of insuring a property to other insurers b. Is a form of windstorm self-insurance that is funded entirely by three or more associations c. Must be provided by an excess lines insurer d. Is illegal in the state of Florida

a. Enables a primary insurer to transfer part of the risk of insuring a property to other insurers

Filing a fraudulent insurance claim is: a. A first-degree misdemeanor b. A second-degree felony c. A third-degree felony d. A second-degree misdemeanor

C. A third-degree felony

All of the following are true of Citizens Property Insurance Corporation except: a. Its legislative purpose is to provide property insurance to persons and entities, including community associations, at a lesser cost than the private insurance market. b. It offers commercial residential multiperil policies to existing policyholders. c. It offers commercial residential windstorm only policies to new policyholders d. It offers commercial residential policies excluding wind to new policyholders

a. Its legislative purpose is to provide property insurance to persons and entities, including community associations, at a lesser cost than the private insurance market

The managing entity of a timeshare must use due diligence to obtain: a. Property insurance, which will be charged separately to the timeshare members b. Casualty insurance, as a common expense, to protect the timeshare property against all reasonably foreseeable perils c. All insurance as may be required by F.S. 718 d. The managing entity is not required to obtain insurance for the timeshare property

b. Casualty insurnace, as a common expense, to protect the timeshare property against all reasonably foreseeable perils

F.S. 720 requires HOAs to: a. Use its best efforts to obtain and maintain adequate insurance to protect the association property b. Do nothing. The HOA Act is silent. Case law suggests that HOAs should follow the requirements of the Condominium Act. c. Obtain a Directors and Officers policy d. Determine the amount of its deductible at a properly noticed and quorumed board meeting

b. Do nothing. The HOA Act is silent. Case law suggests that HOAs should follow the requirements of the Condominium Act.

Citizens Property Insurance Corporation: a. Is a not-for-profit entity created by the Florida Community Association Coalition b. Is a not-for-profit government entity, created to provide insurance to individuals and entities that are unable to find insurance in the private sector c. Is a catastrophe fund that assesses private insurers to cover unfunded liabilities d. Offers discounts to associations for hurricane protection, based upon a questionnaire completed by the manager

b. Is a not-for-profit government entity, created to provide insurnace to individuals and entities that are unable to find insurnace in the private sector

The Homeowner Claims Bill of Rights: a. Is required to be provided to residential property policyholders by the insurer within 21 days after receiving an initial communication with respect to a claim, unless the claim follows an event that is the subject of a declaration of a state of emergency by the Governor. b. Is a summary of existing Florida law in simple, non-technical terms, regarding the rights of a personal lines residential property insurance policyholder who files a claim of loss c. Can serve as the basis for a civil cause of action by any individual policyholder or class of policyholders against an insurer d. Includes all of a policyholder's rights under Florida law regarding the insurance policy

b. Is a summary of existing Florida law in simple, non-technical terms, regarding the rights of a personal lines residential property insurance policyholder who files a claim of loss

The state agency that has primary responsibility for regulation, compliance, and enforcement of insurance related Florida statutes is the: a. Department of Insurance (DOI) b. Office of Insurance Regulation (OIR) c. Division of Insurance Code Enforcement (DICE) d. Bureau of Insurance Compliance (BIC)

b. Office of Insurance Regulation (OIR)

A claim for extensive mold mitigation and repairs on a perimeter wall of unit 1121 was recently denied by the condominium's insurance carrier. The declaration identifies the perimeter walls as association property. The owners, who reside in their units, were aware of, but did not report, the problem to the association. Pursuant to F.S. 718, who is responsible for paying for the repairs? a. Since the unit's perimeter walls belong to the association, the repair costs must therefore be borne by the association. b. The owners of unit 1121 reside in their unit and should have reported the mold to the association before it became an extensive problem. Therefore, the owners are responsible for the costs of the repairs. c. The association and the owners are both responsible and should split the cost of mitigation and repairs. d. The owners should file claims with their insurer. Any deductible should be split between the owners and the association.

b. The owners of 1121 reside in their unit and should have reported the mold to the association before it became an extensive problem. Therefore, the owners are responsible for the costs and repairs.

An association may apply to OIR to form a self-insurance fund for windstorm insurance with at least two other residential associations if all of the following criteria are met except: a. The associations operate more than 50 units. b. The type of insurance is limited to property or casualty risk, general liability or surety insurance. c. The coverage is sufficient to cover the probable loss of a 250-year windstorm event, as determined by a competent model that is accepted by the Florida Commission on Hurricane Loss Projection Methodology. d. The associations were created under F.S. 718, F.S. 719, F.S. 720, or F.S. 721.

b. The type of insurance is limited to property or casualty risk, general liability or surety insurance

The Cooperative Act has which of the following insurance requirements for associations? a. To obtain flood, windstorm and liability insurance, based upon an appraisal performed by a licensed appraiser within the past 36 months b. To use its best efforts to obtain and maintain adequate insurance to protect the association property. c. To purchase D & O insurance if required by the documents d. To participate in self-insurance pools, without a vote of 2/3rds TVI

b. To use its best efforts to obtain and maintain adequate insurnace to protect the association property

F.S. 627.70131(1) provides certain conditions that an insurer must meet, upon receipt of a claim. These include: a. The insurer, must, within 30 days, review and acknowledge receipt of the claim, unless the insurer has already made payment, or the insurer cannot respond due to conditions beyond its control. b. Within 10 working days after an insurer receives proof of loss, the insurer must begin investigation as may be necessary, unless the insurer cannot do so due to conditions beyond its control. c. Within 120 days of receiving notice of a supplemental property claim, the insurer must either pay the claim or deny the claim. d. Claims which are not paid within 60 days after the insurer receives notice must bear interest at a rate established by the OIR.

b. Within 10 working days after an insurer receives proof of loss, the insurer must begin investigation as may be necessary, unless the insurer cannot do so due to conditions beyond its control

Certain insurance policies are required to include a notice regarding law and ordinance coverage. Pursuant to statute, these policies must include specific language in: a. 16-point Arial, bold type b. 1-point Times Roman, bold type c. 18-point, bold type d. 20-point, bold type

c. 18-point, bold type

To establish the association's legal requirements in purchasing insurance, the association should consult all except the following: a. Enabling statutes, such as the Condominium Act b. Lenders who directly or indirectly affect the insurance market c. A professional insurance consultant with expertise in the reinsurance market d. The association documents

c. A professional insurance consultant with expertise in the reinsurance market

Condominium associations are required to insure all of the following except: a. All portions of the condominium property located outside of the units b. Condominium property located inside the units, as such property was initially installed, or replacements of like kind and quality, and in accordance with the original plans and specifications, or, if the original plans and specifications are not available, as they existed at the time the unit was initially conveyed c. All portions of the condominium property for which the bylaws require coverage by the association d. All alterations and additions that have been made to the condominium property pursuant to F.S. 718.113(2)

c. All portions of the condominium property for which the bylaws require coverage by the association

F.S. 718 requires condominium members to insure all of the following items in their own units except: a. Water heaters and water filters b. All floor, wall, and ceiling coverings c. Built-in cabinets and countertops unless they were initially installed by the developer d. Appliances and electrical fixtures

c. Built-in cabinets and countertops unless they were initially installed by the developer

Dexter Garcia, President of Misty Rivers Condominium, is angry because the association's property insurer, Payless Insurers, has failed to pay a claim of $250,000 for damages due to a broken pipe in Unit 455. It has been six months, and Payless has failed to respond to any calls or letters. What is Dexter's best option? a. File a lawsuit in the Circuit Court. b. File a claim with OIR, requesting payment from the Catastrophe & Major Damages Insurance Fund (CMDIF). c. Contact OIR and request that it direct Payless to participate in a mediation claims settlement conference. d. Dexter has none. Insurers have up to a year to pay claims for water damage.

c. Contact OIR and request that it direct Payless to patricipate in a mediation claims settlement conference

An individual condominium in a multicondominium complex that has not consolidated its financial operations: a. Must participate in the multi-condominium insurance policy, even if the individual condominium can obtain insurance less expensively on its own b. May opt out of the multi-condominium insurance policy and purchase its own policy, by a vote of a supermajority of the board c. May opt out of the multi-condominium insurance policy and purchase its own policy, by a vote of a majority TVI d. May opt out of the multi-condominium insurance policy and purchase its own policy, by a vote of 2/3s TVI

c. May opt out of the multi-condominium insurance policy and purchase its own policy, by a vote of a majority TVI

The Business Judgment Act means that directors and officers: a. Perform their duties as they see fit, based upon input from family and friends b. Attend a CAM pre-licensure course c. Perform their duties in a manner that they reasonably believe to be in the best interest of the association d. Always select the highest bidder on a contract, because it is likely to best serve the association

c. Perform their duties in a manner that they reasonably believe to be in the best interest of the association

All of the following are true of sinkhole and catastrophic ground cover collapse coverage except: a. All insurers must provide coverage unless waived by the insured. b. In most policies, structural damage is defined as damage affecting foundations or buildings. c. Renewal policies include coverage to driveways and sidewalks in addition to the foundation and the building. d. An insurer does not have to pay damages under a catastrophic ground cover collapse insurance policy unless the structure is condemned.

c. Renewal policies include coverage to driveways and sidewalks in addition to the foundation and the building

Hurricane Esther damaged several units in the Everly Hills Estates Condominium. As the manager inspected the property, he observed that a fallen tree planted behind unit 403 had crushed the air conditioner serving unit 401. What should the manager do? a. Express sympathy to the member for the misfortune they experienced. b. File a claim against unit 403's insurance carrier. c. Take a picture and ensure that a claim is filed with the association's insurer. d. Advise the member to file a claim with their insurer, because casualty damage to an exterior a/c component is always the member's responsibility.

c. Take a picture and ensure that a claim is filed with the association's insurer

All of the following are presumed to be true of directors and officers under the Business Judgment Rule, except: a. That they know the requirements of their positions b. That they know the association documents and applicable laws c. That they know when to defer policy decisions to a CAM, attorney, accountant, or other person who has been trained to understand statutory responsibilities d. That they spend sufficient time to properly carry out their responsibilities, pursuant to the association documents and governing law

c. That they know when to defer policy decisions to a CAM, attorney, accountant, or other person who has been trained to understand statutory responsibilities

A member of a condominium is responsible for the costs of repair or reconstruction of the condominium property if insurance does not cover the costs and the damage was caused by which of the following? a. The member's unintentional conduct b. Negligence of the association c. Failure of the member to comply with the terms of the articles of incorporation d. Intentional conduct by the member's guest

d. Intentional conduct by the member's guest

All of the following are true of self-insurance except: a. It is a risk management method in which a calculated amount of money is set aside for a potential future loss. b. The association may assess members to obtain the necessary funds. c. It may be funded through a line of credit with a financial institution. d. It is a risk management method that requires the purchase of insurance from an insurance company.

d. It is a risk management method that requires the purchase of insurnace from an insurance company