HLS 12RS-661 ORIGINAL
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Regular Session, 2012
HOUSE BILL NO. 311
BY REPRESENTATIVE LEGER
CONDOMINIUMS: Authorizes alternative forms of insurance to satisfy the requirement
that condominium associations carry a fidelity bond
AN ACT1
To amend and reenact R.S. 9:1123.113, relative to condominiums; to authorize an equivalent2
form of insurance to satisfy the requirement that condominium associations maintain3
a fidelity bond; to require proof of the insurance to be kept on the condominium4
premises; to provide for the right to inspect the proof of insurance; to require notice5
of the insurance and the right to inspect the proof of insurance; and to provide for6
related matters.7
Be it enacted by the Legislature of Louisiana:8
Section 1. R.S. 9:1123.113 is hereby amended and reenacted to read as follows: 9
ยง1123.113. Fidelity bond or equivalent form of insurance required10
A. Any unit owners' association collecting assessments for common11
expenses shall obtain and maintain a blanket fidelity bond or other equivalent form12
of insurance covering the officers, directors, and persons employed by the unit13
owners' association, and any managing agent and employees of the managing agent.14
B. The bond or equivalent form of insurance shall provide coverage in an15
amount equal to the lesser of one million dollars or the amount of reserve balances16
of the unit owners' association plus one-fourth of the aggregate annual assessment17
of the unit owners' association. The minimum coverage amount shall be ten18
thousand dollars.19 HLS 12RS-661 ORIGINAL
HB NO. 311
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CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
C. Any unit owners' association whose managing agent maintains its own1
bond or equivalent form of insurance shall be in compliance with this Section,2
provided that the managing agent's bond or equivalent form of insurance meets the3
requirements set forth in this Section, and that the association is named as an4
additional insured under the managing agent's bond or equivalent form of insurance.5
D.(1) The unit owners' association or the managing agent shall maintain6
proof of the bond or equivalent form of insurance required by this Section on the7
premises of the condominium at all times.8
(2) The unit owners' association or the managing agent shall make the proof9
available for inspection by a member of the condominium unit owners' association10
upon request of the member.11
(3) The unit owners' association or the managing agent shall also provide12
every member of the unit owners' association with written or electronic notice of the13
bond or equivalent form of insurance as well as a statement notifying the member14
that the member has a right to inspect the proof of the bond or equivalent form of15
insurance required by this Section.16
DIGEST
The digest printed below was prepared by House Legislative Services. It constitutes no part
of the legislative instrument. The keyword, one-liner, abstract, and digest do not constitute
part of the law or proof or indicia of legislative intent. [R.S. 1:13(B) and 24:177(E)]
Leger HB No. 311
Abstract: Authorizes a condominium association to carry an equivalent form of insurance
to satisfy the requirement that the association maintain a fidelity bond.
Present law requires any unit owners' association collecting assessments for common
expenses to obtain and maintain a blanket fidelity bond covering the officers, directors, and
persons employed by the unit owners' association, and any managing agent and employees
of the managing agent.
Proposed law retains present law but provides the association with the option of obtaining
another equivalent form of insurance to satisfy the requirement.
Present law requires the bond to provide coverage in an amount equal to the lesser of
$1,000,000 or the amount of reserve balances of the unit owners' association plus 1/4 of the
aggregate annual assessment of the unit owners' association. Present law further provides
that the minimum coverage amount shall be $10,000. HLS 12RS-661 ORIGINAL
HB NO. 311
Page 3 of 3
CODING: Words in struck through type are deletions from existing law; words underscored
are additions.
Proposed law retains present law and requires the optional equivalent form of insurance to
meet the required minimum coverage amounts.
Present law requires the unit owners' association or the managing agent to maintain proof
of the required fidelity bond on the premises of the condominium at all times.
Proposed law retains present law and requires the unit owners' association or the managing
agent to maintain proof of the optional equivalent form of insurance on the premises of the
condominium at all times.
Present law requires the unit owners' association or the managing agent to make the proof
available for inspection by a member of the condominium unit owners' association upon
request of the member.
Proposed law retains present law.
Present law requires the unit owners' association or the managing agent to provide every
member of the unit owners' association with written or electronic notice of the bond as well
as a statement notifying the member that the member has a right to inspect the proof of the
bond.
Proposed law retains present law and requires the unit owners' association or the managing
agent to provide every member of the unit owners' association with written or electronic
notice of the optional equivalent form of insurance as well as a statement notifying the
member that the member has a right to inspect the proof of insurance.
(Amends R.S. 9:1123.113)