Condominium and Homeowners’ Associations Should Carefully Review Insurance Policies to Ensure Coverage for Disability Discrimination Claims

February 3rd, 2017

Posted in Business & Corporate Law

Generally, condominium and homeowners’ associations have obligations under state and federal laws to not discriminate against persons with disabilities.  Many forms of discrimination are intuitive, but others are not.  Under the Fair Housing Acts (both federal and state), discrimination includes the failure to permit reasonable modifications of existing premises, at the expense of the person requesting the modification, as may be necessary to afford a handicapped person full enjoyment of the premises.  Discrimination also includes the refusal to make reasonable accommodations in the “rules, policies, practices, or services” when such accommodations may be necessary to afford a handicapped person equal opportunity to use and enjoy a dwelling. 

When a condominium or homeowners’ association refuses to grant a reasonable modification or accommodation, a disabled person may file a complaint with the United States Department of Housing and Urban Development (HUD), with the Florida Commission on Human Relations (FCHR), or with another local agency with whom HUD contracts to implement and enforce the Fair Housing Act.  The disabled person may also file a civil lawsuit and avoid the administrative process, but administrative complaints appear to be more common.  Of the discrimination complaints filed with HUD, over half involved claims of disability discrimination and there is an upward trend in the number of disability discrimination complaints received by HUD from 2012 to the present.[1]

If a disabled person files a complaint with an administrative agency such as HUD or the FCHR, the agency will begin an investigation and ultimately determine whether reasonable cause exists to further prosecute the association (and often its management company) for discrimination.  Also, if the disabled person chooses the administrative route, the agency will investigate and prosecute the claim at no cost to the disabled person.  On the other hand, a community association will likely spend thousands of dollars in legal fees for legal counsel’s assistance with the investigation and adjudicatory process.  Further, even if it is ultimately determined that the association did not discriminate, it will probably not be awarded attorney’s fees against the person who claimed discrimination.

It is important to understand that irrespective of whether a claim of discrimination has merit, it will cost the association a significant amount of money for legal counsel’s assistance throughout the process.  Accordingly, it is important to carefully review the association’s (and management’s) insurance policies to ensure coverage is available for claims of discrimination.  Specifically, the association should review its insurance policies, and most likely the director’s and officer’s liability policy (often referred to as “D&O” or “E&O” policies), to ensure that it contains a duty-to-defend clause, that discrimination claims are included within the definition of “Claim,” and that it does not contain a specific exclusion for claims of discrimination.  Simply choosing the least expensive policy could result in the association being exposed to significant, uninsured risk.

Managing risk is one of the most important functions of a community association.  Accordingly, the association’s insurance policies should be carefully reviewed to ensure coverage and legal defense costs will be available if the association is prosecuted for alleged discrimination.  Also, community associations’ boards of directors are strongly encouraged to seek the advice of a qualified Florida attorney if there are questions regarding its obligations under pertinent disability laws, risk exposure, or the scope of coverage offered by a particular insurance policy.  In addition, community associations are also encouraged to contact experienced legal counsel if they believe their insurance claim may have been wrongfully denied by its insurance company.


[1] Office of Fair Housing and Equal Opportunity, Annual Report to Congress (2016) (available at

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