Following an article that we published last month concerning communal insurance, we have received feedback from some of our readers concerning their confusion over the difference between communal and committee insurance. In the following, we aim to clarify this difference while at the same time offering a brief resume of why committee insurance is also important to the correct operation of your committee and its activities.
Spotting the difference
While communal insurance is targeted (in the main) at the property and its fixtures and fittings, committee insurance covers the legalistic and functional aspects of the managing body responsible for those assets. This is likely to include such things as legal claims against the committee and its members along with claimable losses which may (or may not) be as a result of the body’s activities or instructions.
So why does your committee need insurance?
While there are certain legal requirements laid out in Cyprus law concerning the need to form and operate complex committees, levels of cover regarding insurance appear to be somewhat vague, to say the least. That said, the law is much clearer when it comes to the potential penalties that might be levied in the event of none-conformation with the often overburdening letter of that law. Therefore, as in the case of communal insurance, planning for the worst and anticipating the best remains the preferred approach.
The dangers of under-budgeting on committee insurance
One of the biggest bugbears for committee members is that of rising costs and the returns on the money that they spend. After all, it is the residents’ money that is being spent and anyone who has ever stood on a communal committee will know all too well how that position so often places them between the proverbial “rock and hard place”. However, committee insurance predominately concerns protection rather than cost and it is wise to view it in that light when budgeting. As many committee members have already learnt to their cost, they ultimately bear responsibility for the actions and liabilities of the legal entity which they represent.
Making the best-informed choices
With responsibility and accountability being prerequisites of any complex committee it follows that choosing the best possible insurance at the most competitive price is likely to be a priority. We appreciate that ordinary members cannot be “all things to all men” and that includes being an expert in committee insurance. The good news is that professional and cost-effective help is only a phone call, email or click away.
Trust your communal insurance to the professionals
Having the benefit of almost two decades of communal management and insurance experience, Lee Property Services can recommend professional communal insurance services at the best prices on the market. Along with our proven track record in all aspects of complex property management, we have built long-term business relationships with insurance companies that offer policies tailored to your specific requirements.
Call us now on 23831194 concerning all aspects of complex management from formations and operation to accounting and fee collection.