Volunteers!! - Protecting Your HOA

by Tiffanie Thompson, SentryWest Insurance 

Let’s talk about Association Volunteers! 

Who doesn’t love and appreciate anyone willing to help out?!  Of course, we all do, but is our Association covered?
Typically, we all hear the term “Workers Compensation” and immediately think that would only apply to businesses. “We don’t have any ‘employees’”, “we hire independent contractors”.  How does this apply to my Homeowners’ Association? 

First, let’s understand what coverage Workers Compensation provides. 

Workers’ Compensation is provided to protect employers for work related injuries to their employees.  The benefits can be medical expenses and income compensation that is provided to the employee, regardless of who is at fault. 
Workers’ Compensation coverage should be utilized by any Associations that have direct employees and indirect employees such as board members, volunteers, and committee members.

Of course, you are still wondering why would my Homeowners’ Association need this?  

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An example would be John Smith, the ideal Association member. John is a really great guy, always the first person to volunteer around the neighborhood.  John is really great at tree trimming.  John volunteers to help the Association save some money on a landscaper and trim the trees in the neighborhood himself without compensation from the Association. 
As John trims the trees, he hits his head on a falling limb. John thinks the Association needs to pay for his medical expenses but the Association thinks he’s a volunteer.  If the association is deemed as the “employer” of John, they could be responsible for his medical expenses and lost wages.  After all, John was unable to return to his regular day job for several days after being hit by the falling tree limb. 
John is still injured but the HOA still needs the trees trimmed and the board members decided it would be wise to hire a professional contractor.  The contractor arrives at the job and starts to trim the tree but injures himself.  A couple of things happened before the project began, the HOA did not ask for a current proof of insurance and the contractor forgot to pay his bill so the policy was cancelled.  The Association could now be on the hook for the contractors’ injuries and lost wages, as well as John’s.
In both cases, the association would be covered if they had their own Worker’s Compensation policy! 
The property managers policy will not protect YOU, the Association.  The property managers are generally the ones dealing with contractors but in most cases the property manager is not the company hiring the contractor, the HOA board is responsible for that.  The property manager’s insurance should not be used as a safety net for the Association.

The best protection is for the Association to have their own policy!

A standard Workers’ Compensation policy covers only “paid” employees.  It is important to make sure there is coverage for volunteers, board members or committee members.  
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The cost of the policy can range from $500 -$1,000.  ​