Insurance Pain Hit’s HOA’s Hard
by Dave Rauch
Reflecting on Challenges and Looking Ahead to 2025
Every summer, our Community Manager clients begin the challenging task of creating budgets for their HOA clients, starting for the new year on January 1st. This past summer was particularly difficult as budgets were impacted by several factors, including:
· A 20%+ average increase in insurance costs, driven by:
· California wildfires from previous years, Hurricanes and other natural disasters
· The collapse of Champlain Tower South (Florida HOA)
· Some clients in “fire zones” faced insurance increases of 100% or more.
· Additional expenses tied to compliance with California’s new Deck Law (SB 325/AB 5551).
With these pressures, many HOAs cut or slowed down discretionary expenses, including some of our construction work.
The Good News
Our CAMPs were included in operating budgets, so they were less affected. However, construction departments (50, 150, and 250) experienced the biggest impact, followed by departments 360, 660, and 760. We implemented #GiveMe5 to assist in acquiring new contracts for these departments.
To adapt, many of our construction technicians transitioned to maintenance roles, ensuring steady work. The leadership from our department heads and Lead AMs has been incredible, keeping as many of our team members working as possible. Unfortunately, we did have to make some reductions in overhead and workforce to remain competitive.
Looking Forward to 2025
As we begin the new year, we’re optimistic about a return to normalcy. However, the challenges from the LA fires remind us to:
1. Keeping an eye on our costs
2. Work harder to boost revenue
3. We need to be indispensable to our clients - to keep delivering a service that our clients can't live without!
Here’s how you can help:
· Keep an eye out for additional work opportunities in our clients’ communities.
· Take pictures of issues you notice and share them with your supervisor.
By working together, we can make 2025 a fantastic year. Thank you for your continued dedication and hard work.
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