Volume 301 No. 101


Life and Community Living


Insurance Requirements

Changes to the Illinois Condominium  

Property Act Effective June 1, 2015 




In our last newsletter we briefly discussed many upcoming changes in the Illinois Condominium Act that went into effect as of the first day of 2015. There are several changes that go into effect on June 1, 2015 related to insurance coverage. We are reviewing these changes with your insurance agent. Here is a brief summary of those changes:

  • Beginning in June, property insurance policies issued to condominium associations must include minimum required coverage for demolition costs and the increased costs of construction. Ordinance or Law coverage B (demolition) and C (Increased Cost of Construction) must be a total minimum limit of 10% of the cost to rebuild or $500,000, whichever is less.

  • A board of directors may no longer buy unit owner's insurance for members of the association and bill the unit owner for coverage.

  • The Directors and Officers (D&O) liability insurance will be required to be broader and more inclusive. It will need to include volunteers, directors, and officers from claims or lawsuits. Illinois Condominium Property Act (ICPA) Section 12(a)(3)(D) requires that D&O insurance policies provide coverage for non-monetary claims (e.g., a lawsuit seeing an injunction or a declaratory judgment), breach of contract actions, and claims related to placement or adequacy of insurance. In addition, the D&O liability coverage must include coverage for past, present and future board members, the managing agent, and employees of the board or its managing agent.

  • The definition of "improvements and betterments" in ICPA Section 12(b) has been revised to include "additions, alterations or upgrades installed or purchased by a unit owner."

Information provided courtesy of Total Insurance Services, Inc. of Northbrook, IL.

Community Association Living-

How do we compare? 



We like to think most community association neighbors are happy living in their community and we certainly hope your owners are among them. But how do the more than 65 million Americans who live in homeowners associations and condominium communities feel about their own homeowners associations and condominium communities? Are they happy with their elected boards? How do they feel about the rules?


The Foundation for Community Association Research, an affiliate of the Community Associations Institute (CAI), sponsored a recent national public opinion survey to answer these and other questions. Here are some of the key findings:


  • 90% of residents rate their overall community association experience as positive (64%) or neutral (26%).
  • 90% of residents say association board members "absolutely" or "for the most part" serve the best interests of their communities.
  • 83% say they get along well with their immediate neighbors.
  • 92% say they are on friendly terms with their association board members.
  • 83% of residents say their community managers provide value and support to residents and their associations.
  • 88% of residents who had direct contact with their community manager say it was a positive experience.
  • 70% of residents say their association's rules protect and enhance property value; only 4% say the rules harm property values.

 More national survey results, which include comparative data from similar surveys in 2005, 2007, 2009 and 2014, are available at http://www.caionline.org/2014survey.

Meetings - We're Having What Kind of Meeting?business-meeting-sm.jpg 
What's the difference between a board meeting and a special meeting, or an annual meeting and a town meeting? Confused? Here's some clarification


Annual Meetings

Annual meetings, or annual membership meetings are required by governing documents, which specify when they're to be conducted and how and when members are to be notified about the meeting. This is the main meeting of the year when members receive the new budget, elect a board, hear committee reports and discuss items of common interest.


Special Meetings

Special meetings are limited to a particular topic. The board can call a special meeting at any time and all association members must be notified in advance. The notice will specify the topic to be addressed. Special meetings give the board an opportunity to explore sensitive or controversial matters. An example might be an assessment increase. Members do not participate in the meeting unless asked directly by a board member. However, members have a right to listen to the board discussion.


Town Meetings

Town meetings are informal gatherings intended to promote two-way communication. Full member participation is essential to success. The board may want to present a controversial issue or explore an important question like amending the bylaws. The board may want to get a sense of the members' priorities, garner support for a large project or clarify a misunderstood decision.


Board Meetings

Most of the business of the association is conducted at regular board meetings. Board members set policy, oversee the manager's work, review operations, resolve disputes, talk to residents and plan for the future. Often the health and harmony of an entire community is directly linked to how constructive these meetings are.


Executive Session

The governing documents require the association to notify members in advance of all meetings. Members are generally encouraged to attend and listen. Executive sessions are the one exception. The only time you can't listen is when the board goes into executive session. Subjects that the board can discuss in executive session are limited by law to a narrow range of sensitive topics. Executive sessions keep only the discussion private. No voting takes place. The board must adjourn the executive session and resume the open session before voting on an issue. In this way, members may hear the outcome, but not the private details.



Occasionally the association notifies all residents of a meeting during which absolutely no business is conducted. Generally these meetings include food and music, and they tend to be the best attended meetings of the association. Oh, wait! That's a party, not a meeting. Well, it depends on your definition of meeting.

Safety/Fire - Keep an Eye on What You Fry  

Nearly two-thirds of all kitchen fires start on the range or cook top. To prevent fires in your kitchen, don't leave food unattended on burners or the stove top, especially if you are frying food. If you have to step away from the stove or leave the kitchen, turn off the heat or flame and remove the pan from the burner. Keep food packaging, wooden spoons and dish towels, mitts and other fabrics, including your clothing, away from the cooking surface.


If food on the stove does ignite, cover the pan with a lid and turn off the stove. Never try to extinguish a kitchen fire with water. If the flames are unmanageable, leave the kitchen and call 9-1-1 immediately.


Grease and food particles that collect in range hoods and stove vents also can be a kitchen fire hazard. The National Air Duct Cleaners Association (NADCA) recommends inspecting and cleaning residential kitchen exhausts twice a year. Shared vent ducts in condominiums should be inspected by a professional. For more information, visit http://nadca.com.


For more information on kitchen fires and how to prevent them, visit the National Fire Protection Association at http://www.nfpa.org/safety-information/for-consumers/causes/cooking/safety-messages-about-cooking.  

Associations for Condominiums, Townhouse, and Homeowners Associations (ACTHA)   

Cagan was one of the sponsors for the recent ACTHA Educational Conference & Trade Show held at the Drury Lane Convention Center, April 18th in Oakbrook Terrace. It was great to see some of you there taking advantage of the very relevant seminars and meeting vendors who offer new resources for repairs and improvements. Want to learn more? Check out the opportunities a membership provides. Visit www.actha.org or call 312-987-1906.

Cagan Leadership Seminars 2015



Date: Tuesday, June 2nd, 2015

Time: 6:30PM Refreshments / 7:00PM Program

Location: Cagan Management Group, Inc.

Address: 3856 Oakton, Skokie, IL 60076

RSVP: Janet Nelson, jnelson@cagan.com, 847-324-8961

As a full-service management consulting firm, we partner with our clients to deliver solutions that help solve their most complicated needs. Our services are designed specifically to help small businesses, and at a small business price. Utilizing decades of industry experience and functional expertise, Management Consulting goes beyond the norm to develop new insights, drive results, and help grow your business. Learn More
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