Insurance Coverage for Co-operative Housing Society

Co-operative Housing Societies are generally exposed to various types of peril and operation of these perils affect its Financial well-being greatly.  Yes, the risk that affects the Cooperative society financially, can be insured.

Property Damage

The co-operative society which is run by its members who own the Building structure, Various Utilities & equipment within the compound of the Cooperative Society, to the extent of their share.  As per bye law no. 161 (a) of the model bye-laws of Co-operative Housing Societies, the cooperative Housing societies are required to insure their Building structure and other utilities adequately against the Fire and allied risks like  Storm, Flood, Earthquake, Terrorism etc.

Off late India has experienced major natural calamities like Flash flood of Uttarakhand, J & K and recent floods arising out of Torrential rains in Chennai & Cyclones in almost every year of  different intensity leading to financial losses ranging from Rs.5,000 to 50,000 Crores each event.  Worrying part is that only 10% to 20% of these losses are found insured. Moreover, out of the total insured losses, majority of assets were under-insured i.e. not adequately insured.

How adequate Insurance Coverage can be ensured?

It can be ensured in following 2 ways –

  • Opting Correct insurance policies to cover different types of the risks existing in cooperative housing societyMechanism to arrive at adequate insurance coverage to reduce possibilities of getting meagre compensations at the time of claims.
  • Mechanism to arrive at adequate insurance coverage to reduce possibilities of getting meagre compensations at the time of claims

Assets to be covered for Insurance in Co-operative Housing Society

Third Party Liability

When third party like Guests or any other party not related with the Cooperative society enters the Society compounds and suffers injury or death or damage to their property because of any accident within the compound of the Cooperative society, the person who has suffered  injury or their dependents can put a claim against the society for compensation.  The compensation is subject to Court Procedures and terms and conditions of the policy.

Committee Members Liability

The committee members can face a legal suit for the decisions taken which may affect the member or mass adversely.   The same may result into incurring the legal cost to defend such case and also pay compensation if the court orders against.

In any cooperative society these risks are prominent.  Although taking proper insurance coverage cannot avert them, the cooperative society can safeguard themselves from such accidentally erupting massive Financial Outgoes which may cripple the Societies Financial Health severely.

Insurance Coverage Available

Precautions to be taken to ensure Adequate Insurance Coverage

The objective of this article is to make the people  aware about necessity of  Insurance Protection and also its adequacy from the point of view of getting just & fair settlement in case of a claim.

In case of any queries please write to laxminarayan@spectrumadvisors.in

5 thoughts on “Insurance Coverage for Co-operative Housing Society

  1. Ujjwal Reply

    We are 10 year old housing society. We do collect sinking fund but should we think of insurance for buildings?

    What could be premium amount for this type of insurance?

    Can we stop sinking fund and take {renew} insurance?

    Please advice.

  2. Sebastian Reply

    Actually I was looking to get my housing society insurance policy.. Please can you let me know what has to be done and please provide me with the details

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