Maryland Insurance Legislation and Possible Changes
This year the Maryland Legislature has seen fit to bring before it a pair of bills that could have a drastic effect on both homeowners and associations.
The first is SB 175, which proposes to increase the legal liability of condominium homeowners in an insurable event from the current $5,000 limit to a $10,000 limit. This doubling of the deductible in condominium policies would shift part of the liability from the condominium back onto homeowners, but would also provide a more equitable share of the market's liability and both potentially reduce condominium policy costs (which would benefit homeowners paying into their condominium) and, in cases where the condominium's policy deductible is more than the $5000 cap currently mandated by Maryland law, it would enable the condominium to use less of its cash-on-hand to meet that deductible, again helping the condominium preserve money--which will slow the rate of assessment growth.
The second bill is more famous-- the tax hike proposed by the legislature in response to the Kirwan Commission's suggestions regarding the educational system and how to properly fund it. That bill was defeated in the legislature, but the type of funding required statewide to pay for the education improvements the Commission recommends will still need to come from somewhere.
ACM--and your community legal representatives--will keep you updated on these measures if you ask, and please ask--we'd love to help you understand them.