Two tropical storms have passed Sarasota County this year prompting two local emergency declarations.
But, Siesta Key condominium owners who want to insure their property against wind damage may have to pay as much as triple the premiums they currently pay if covered by Citizens Property Insurance.
Siesta Key Condominium Council Vice President Walt Olson recently conducted a survey of 81 condominium associations on the island, comprised of about 7,000 individual units, to determine which buildings would be limited in wind coverage under Citizens’ new policy. He estimates after initial analysis that 45% might have to purchase new insurance.
The insurer’s board of directors voted Feb. 23 to restrict coverage to $1 million for associations that rent more than 25% of its occupancy, moving the risk classification from residential to commercial. The Condominium Council Board of Directors has said during meetings this year that buying further coverage will raise rates by 400% to 500% above levels owners currently pay, Olson said.
The study is only a starting point, Olson said. The goal of the condominium council is to target the buildings affected by the new policy and educate associations on how to manage under it.
Condominium associations are allowed to change their rental policy before the effective date of Aug. 1, according to documents provided by Olson. One of the suggestions in condominium council documents is to determine how many units need to reduce their rental periods to bring the condominium under the 25% threshold, then require that number of units to rent for periods of one, two and three weeks, then set a 30-day restriction.
“I was very pleased,” Olson said of the 85% survey response. “Sometimes you ask yourself, ‘Is anybody reading this stuff?’”
Citizens Property Insurance will no longer insure a condominium for more than $1 million in wind coverage if it has more than 25% transient occupancy.
When property inspectors visit a condominium, they might use several cues to determine if there is transient occupancy, or rentals of less than 30 days:
• The name of the property includes the word “resort”
• There is a registration desk in the lobby for short-term rentals
• A commercial laundry facility is on the property
• Housekeeping staff is on the premises
• The property uses commercial passenger vans