Category: Risk Advisory

The standard risk review ends with a long document. Forty findings, each one marked high, medium or low. The client reads the first page, feels overwhelmed and files the rest.

I built the RMOS Risk Index to fix that. The goal is simple: make risk comparable, rankable and trackable.

Same risk, different weight

A key person leaving is a modest problem for a family with a salaried household and a serious problem for a business that depends on one individual. A condo board and a warehouse owner both face storm risk, but they pay for it and recover from it in very different ways. A good method has to reflect that, so the weights change by client type.

One number, with the work shown

The score runs from 0 to 1000. The number alone is not the point. The useful part is seeing which categories drive it, so the client knows where the next hour or the next dollar does the most good.

What a score cannot do

A score is a decision tool. It is not an insurance quote, a prediction or a guarantee. It is only as good as the information behind it, which is why I document sources and assumptions and show how each category contributed.

Why track it

When you review again after acting on the findings, the number should move for a reason you can name. That is the proof the work did something.

If you want to see how it works, the Our Method page walks through it step by step.

Association boards are made up of neighbors who agreed to help. They end up making decisions about millions of dollars of shared property with limited time and no formal training. Renewal season is where that gap shows.

Here are five questions I would want a board to answer well before the renewal package lands.

1. Are the insured values current?

Building costs change. If the replacement cost on file is out of date, the association may be underinsured without knowing it. Ask when the values were last checked and by whom.

2. Could we pay the storm deductible?

Many associations carry a percentage deductible for wind. Look at the dollar amount that percentage produces today. Then ask where the money would come from. A special assessment on short notice is a hard conversation.

3. Do our directors and officers have protection?

Board members can be named personally in disputes. Confirm that the association carries coverage for board decisions and that the limits make sense for its size.

4. Are our reserves and inspections on track?

Many states have added requirements for condominium inspections and reserve funding in recent years. Rules continue to change, so confirm the details with the association’s attorney. What the board should know is whether the work is scheduled, funded and documented.

5. Do our vendors carry what they should?

A contractor without proper coverage can turn their problem into the association’s problem. Keep current certificates of insurance on file for the vendors who work on the property.

The point

None of these questions require an expert to ask. They require a board that decides to ask them early. If the answers are unclear, that is useful information, and it is much better to learn it in September than in a claims dispute.

This is general information, not legal or insurance advice for any particular association.

Most families I talk to believe they are covered because they have a policy and they pay the premium on time. That is a start. It is not a plan.

A policy is a contract that pays for certain losses under certain conditions. A risk plan starts earlier. It asks what could hurt you financially, how badly, and what you are going to do about it before it happens. Insurance is one answer. It is not the only one, and it is rarely a complete one.

Where homeowners get caught

• Flood is generally not covered by a standard homeowners policy. It is a separate coverage, and many people only learn that after the water arrives.
• Wind and hurricane losses often carry their own deductible, usually a percentage of the home’s coverage amount rather than a flat dollar figure. Know your number and know whether you could write that check.
• Liability limits that looked fine years ago may not fit your life now. A pool, a teenage driver, a rental unit or a growing net worth all change the math.
• Documents matter. If you cannot show what you owned, you will fight to get paid for it.

Look past the house

The house is only one exposure. Income, health, vehicles, your digital accounts, a side business and the way your assets are titled all carry risk. The exposures that hurt most are usually the ones nobody wrote down.

What I would do first

Pull out your declarations pages and read the deductibles and limits, not just the premium. Write down the three losses that would hurt you most. Then ask whether your current setup actually answers each one. If it does not, you have found the first item on your plan.

This is general information, not advice for your situation. Talk to a licensed professional about your own coverage.