IMPORTANT CHANGES TO RHODE ISLAND CONDOMINIUM LAW

In 2022, the Rhode Island Legislature passed a change in the law, R.I. Gen. Laws § 34-36.1-3.13, as it relates to the responsibilities of insurance coverage for Condominiums.  The new law establishes that the Unit Owner’s insurance policy is required to cover the amount up to the Association’s master policy deductible.  This significant change confirms that the Association will no longer foot the bill for the deductible on the master policy.  By way of an example, if the Association’s master policy deductible is $10,000.00, the Unit Owners(s) that are involved in the loss will have that deductible covered by their own insurance policy.  Needless to say, it is important that Unit Owners have the appropriate insurance policy to cover this portion of the claim.  Otherwise, the unit owner will be short the amount of the deductible for the loss.

Boards are strongly encouraged to review their condominium documents to make sure there are no limits on the deductible for the Association’s policy.  Additionally, it is recommended that Boards adopt a policy that details this responsibility and how insurance claims for the Association will be handled in the future.  Making Unit Owners aware of this obligation will help to ensure that the coverage will be in place at the time of a loss.  We cannot over emphasize the importance of having a policy in place so when an insurance loss occurs that policy will serve to avoid any issues.

For more information on adopting policies outlining these responsibilities, please contact Attorney Janet Aronson.