Condo Insurance Payment Made to Unit Owner for Building Damage

S.V. from outside of Connecticut writes:

Dear Mister Condo,

There was damage to the outside of our building. Insurance check was made payable in the name of a condo owner, who is the brother of president of condo association, in the amount of $6,000.00. I could not get an answer from either party and the insurance company why this was not made out to the condo association. Was this legal? I don’t know how the money was spent. This was several years ago. Is there a statute of limitations?

Mister Condo replies:

S.V., that is a strange way of processing an insurance claim at a condominium. However, it is not unheard of and without a full review of the insurance and the claim, it would be very difficult to prove whether anything illegal occurred. In fact, the insurance company would more likely be the one to have a claim if they were defrauded out of money. Was the building damage repaired? Was there further money paid for the repair by the association that the insurance should have covered? If there were no additional monies paid out by the association and the damage was repaired, it is probably best to stop worrying about it. I am not aware of a statute of limitations for you to investigate and/or file a complaint with your association on how the insurance money was distributed but to what end? If you weren’t harmed financially, this is really an item for the insurance company to worry about, not you. All the best!

One thought on “Condo Insurance Payment Made to Unit Owner for Building Damage

  1. It depends. It is pretty common in my experience if that is a payment from a condo owner’s policy The association is responsible for repairs but can have a sizeable deductible. In our case that is $5,000 in others $10,000. So the condo owner’s insurance pays the damage amount up to the owner’s deductible and the owner is responsible for paying the association the deductible whether they are insured or not.

    In practice, the owner then usually signs the check over to the association.

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