La. Rev. Stat. § 1123.112
Insurance
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Statutory text
A. Commencing not later than the time of the first conveyance of a unit to a person
other than a declarant, the association shall maintain, to the extent reasonably available:
Property insurance on the common elements and units, exclusive of
improvements and betterments installed in units by unit owners, insuring against all risks of
direct physical loss commonly insured against. The total amount of insurance after
application of any deductibles shall be not less than eighty percent of the actual cash value
of the insured property, exclusive of land, excavations, foundations, and other items normally
excluded from property policies; and
Comprehensive general liability insurance, including medical payments
insurance, in an amount determined by the executive board but not less than any amount
specified in the declaration, covering all occurrences commonly insured against for death,
bodily injury, and property damage arising out of or in connection with the use, ownership,
or maintenance of the common elements.
B. If the insurance described in Subsection A of this Section is not maintained, the
association promptly shall cause notice of that fact to be hand-delivered or sent prepaid by
United States mail to all unit owners. The declaration may require the association to carry
any other insurance, and the association in any event may carry any other insurance it deems
appropriate to protect the association or the unit owners.
C. Insurance policies carried pursuant to Subsection A of this Section must provide
that:
Each unit owner is an insured person under the policy with respect to liability
arising out of the unit owner's ownership of an individual interest in the common elements
or membership in the association.
The association's insurer waives its right to subrogation under the policy against
any unit owner of the condominium or members of his household.
No act or omission by any unit owner, unless acting within the scope of his
authority on behalf of the association, will void the policy or be a condition to recovery under
the policy.
(4)(a) A unit owner's property insurance policy covering betterments and
improvements shall be primary for that unit owner's betterments and improvements to the
extent of the value of the betterments and improvements. The association property insurance
policy shall remain primary with respect to common elements, structural elements and
components, and fixtures and improvements of the condominium units that are not classified
as betterments and improvements to include damages caused by the event giving rise to an
insurance claim.
(b) For purposes of this Subsection, betterments and improvements include upgrades
or improvements to a particular unit that are of a higher quality than those originally
constructed within the units subject to the condominium regime. The replacement of worn
or obsolete items shall not be considered betterments and improvements unless the items are
upgrades or improvements that are of a higher quality than generally exist within units
subject to the condominium regime. For insurance purposes, at the time of any loss, all unit
improvements and betterments shall be considered the improvements and betterments of the
current unit owner.
Nothing in this Section shall be construed to require the association to insure a
unit owner's individual liability except as set forth in Paragraph
of this Subsection.
Nothing in this Section shall be construed to prevent the association from pursuing any
deductible or out-of-pocket expenses not covered by the association's insurance policies from
the negligent unit owner.
D. Any loss covered by the property policy under Paragraph (A)
of this Section
shall be adjusted with the association, but the insurance proceeds for that loss shall be
payable to any insurance trustee designated for that purpose, or otherwise to the association,
and not to any mortgagee. The insurance trustee or the association shall hold any insurance
proceeds in trust for unit owners and lien holders as their interests may appear. Subject to
the provisions of Subsection G of this Section, the proceeds shall be disbursed first for the
repair or restoration of the damaged common elements and units, and unit owners and lien
holders are not entitled to receive payment of any portion of the proceeds unless there is a
surplus of proceeds after the common elements and units have been completely repaired or
restored, or the condominium is terminated.
E. An insurance policy issued to the association does not prevent a unit owner from
obtaining insurance for his own benefit.
F. An insurer that has issued an insurance policy to the association under this Section
shall issue certificates or memoranda of insurance, upon request, to any unit owner or
mortgagee. The insurance may not be canceled until thirty days after notice of the proposed
cancellation has been mailed to the association, each unit owner and each mortgagee to
whom certificates of insurance have been issued.
G. Any portion of the condominium damaged or destroyed shall be repaired or
replaced promptly by the association unless
the condominium is terminated,
repair or
replacement would be illegal under any state or local health or safety statute or ordinance,
or
eighty percent, or such other percentage provided in the declaration, of the unit owners
vote not to rebuild. The cost of repair or replacement in excess of insurance proceeds and
reserves is a common expense. If the entire condominium is not repaired or replaced,
the
insurance proceeds attributable to the damaged common elements shall be used to restore the
damaged area to a condition compatible with the remainder of the condominium,
the
insurance proceeds attributable to units and limited common elements which are not rebuilt
shall be distributed to the owners of those units and the owners of the units to which those
limited common elements were assigned, and
the remainder of the proceeds shall be
distributed to all the unit owners in proportion to their common element interest. If the unit
owners vote not to rebuild any unit, that unit's entire common element interest, votes in the
association, and common expense liability are automatically reallocated upon the vote as if
the unit had been condemned under R.S. 9:1121.107, and the association promptly shall
prepare, execute, and record an amendment to the declaration reflecting the reallocations.
Notwithstanding the provisions of this Subsection, R.S. 9:1122.120 governs the distribution
of insurance proceeds if the condominium is terminated.
Synced from the Florida Legislature’s official site. Verify the current version before citing.
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Reference only. Not legal advice. Verify current text at the official state legislature website before citing. Printed from Common Elements (August 18, 2026).