If you live in a condo or townhome in Minnesota, you might see your fees increasing. This has become a common trend in recent months, according to an insurance expert.
Helen Mitchell, who has lived in her Coon Rapids townhome for 20 years, was surprised to learn about the increase in fees. Her homeowners association management company sent her a letter mentioning a concerning trend with property insurance. Their total premium more than doubled, meaning Mitchell has to pay more.
According to Aaron Cocking, president and CEO of the Insurance Federation of Minnesota, fewer insurance companies are interested in working with homeowners associations (HOAs) or condos. This could be due to the high risk involved, especially in Minnesota, which experiences severe weather, ranking second only to California in extreme weather occurrences.
The HOA management company’s letter to residents highlights an industry-wide issue. Insurance companies are influencing the market and declining to bid on policies based on factors like the number of units in an HOA and the age of the buildings. This situation could worsen in the future.
Cocking believes that more competition in the insurance market could lower premiums. However, for Mitchell and others like her, the future is uncertain. Some residents are considering moving because of the increasing costs. What was once an affordable option may no longer be feasible for them.
