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Scoop 007

The following are the questions asked by the residents of Plat 3 (Coastal Villas), Plat 4 (Live Oak Village), and Plat 8D (Egret Cove) concerning their insurance coverage.  The answers were provided by Erick Johnson of Acordia, our insurance consultants, during a meeting a Pinckney Hall on Thursday, September 25, 2003.

1. How are the villas insured, i.e., as residential or commercial property?
   
   They are insured as commercial property but the policy recognizes the residential nature of the structures.
   
   

2. Why weren’t villas insured separately from CAM common buildings?
   
   The CC&R’s allow for CAM to make this decision, and as a result CAM felt it to be more prudent to insure them together.
   
   

3. Is the premium for 2004 remaining the same as the 2003 premium or increasing?
   
   All insurance premiums are estimated to rise by 15% in 2004. However, the rate of increase year to year is beginning to slow. Additionally, some reserves will be released to offset the increase so that the assessment remains nearly the same.
   
   

4. Are room additions insured under our group policy or under the individual homeowner’s policies?
   
   The CC&R’s state that what was sold by the developer is covered. Permanent additions are covered under South Carolina Statute in the same policy.
   
   

5. What is the deductible?
   
   The deductible is $2,500 and a revised letter will be sent to confirm that along with a revised certificate of insurance.
   
   

6. Why was the policy not available until September?
   
   The delay resulted from an error in handling. Normally this should be a ten day turn around.
   
   

7. Where is the declaration page of the policy?
   
   It is the front page of the policy.
   
   

8. Why is flood and earthquake coverage included since we are not in a flood or on an earthquake fault?
   
   Sun City Hilton Head is in both flood and seismic zone, and it is therefore prudent to have the appropriate protection.
   
   

9. Are villa unit insurance premiums are higher than comparable single family homes?
   
   There is no way to be certain. However, if the comparison is made, it must be for like risk, like deductibles, like limits, etc. Unless the coverage is identical the comparison won’t be correct.
   
   

10. Is Acordia reviewing our current insurance coverage to see if there are better rates from other insurance carriers? How often will our coverage be reviewed?
    
    Acordia reviews alternative carriers for heavily amenitized large associations and developments at least annually. Additionally the policies are reviewed as needed. This procedure will continue.
    
    

11. How did Acordia determine replacement cost coverage for our villas?
    
    Acordia believes that by using the developer’s costs for new communities and then measuring replacement by outside contractors it has an accurate basis for its coverage. Additional procedures are used to ensure that the correct values are assigned to the units, but it is primarily determined by construction cost and inflation.
    
    

12. Did an Acordia representative visit or development to determine what and how our building would be insured or was the determination made by our Community Association Management?
    
    An Acordia representative visited the premises and continues to make periodic visits, and association management is engaged in the process as outlined in the CC&R’s.

--Material provided by Al Reuben, 10/28/02, WWW editor-Steve Koehl. This page revised: March 22, 2004.