When Should an HOA Board Update Its Governing Documents?

When it comes to a homeowners association’s governing documents, it’s imperative that they are updated to meet the latest standards of the rights and obligations of both the association directors and its membership. Many governing documents are set in stone after the community’s developer finishes construction on a community, putting in motion the rules, regulations and bylaws of the HOA. These documents follow a standard set of guidelines that are enforced to protect and uphold the community.

But as the houses and condos become lived in, filling up with families and residents, governing documents may need to be reviewed and updated at some point to reflect the evolving life needs of those residents. There’s no real timeline or rule to help understand when it’s the best time to update these documents, but these tips should help to navigate this necessary action.

Prepare for Changes

Before anything is changed, updated, fixed, or altered, it’s best to review the requirements for enacting change. A community may need to amend a clause that requires a super-majority, lowering attendance levels that are required to make changes as a whole. An HOA can appoint a sub-committee of interested members who can help review legal documents and identify areas in governing documents that might be ready for changes.

Engage Insurance Coverage

Having the right HOA insurance coverage can go a long way when it comes to handling legal and sensitive matters within a community. HOA insurance coverage, such as Directors and Officers insurance, which can protect members from a myriad of issues like discrimination, breach of contract and mistakes related to governing documents, is meant to protect an HOA when legal issues arise. And when it comes to handling sensitive information related to an HOA’s bylaws and responsibilities you can bet that there is a steady threat of risk of liability.

Size Up Community Needs

An HOA should pay attention to the little things that can result in major problems, such as the use of common areas and amenities, resident suggestions that are brought up, state and local guidelines, and area trends in housing. For example, one major trend that communities are seeing is the use of drones, especially by real estate professionals, to promote houses for sale or rent. Drones have engaged a major push for updating documents so that communities know how to handle liabilities related to their use. It’s important to listen to what residents are saying when it comes to needs as serious issues that are taken lightly can result in residents feeling unheard and unappreciated.

Keep Communication Open

Governing documents can have an effect on every member of an HOA. Changes should be done with everyone in mind and consider what will have the best outcome. Create a communications strategy to invite participation from members to get the most transparent ideas and information out in the open. HOAs should then communicate with members as to why certain changes are being made compared to others so there’s an understanding why it’s beneficial to them.

HOAs should take a thoughtful approach to updating their governing documents. Since they deal with legal obligations and rules for residents to live by, they should not be abruptly or secretly changed. This would most certainly bring liability concerns and put to use HOA insurance coverage that should be used under dire circumstances.

About Kevin Davis Insurance Services

For over 35 years, Kevin Davis Insurance Services has built an impressive reputation as a strong wholesale broker offering insurance products for the community association industry. Our president Kevin Davis and his team take pride in offering committed services to the community association market and providing them with unparalleled access to high-quality coverage, competitive premiums, superior markets, and detailed customer service. To learn more about the coverage we offer, contact us toll-free at (877) 807-8708 to speak with one of our representatives.