Many people, after a year of stay-at-home mandates and capacity restrictions for get-togethers, are planning private parties, such as birthday and anniversary celebrations; weddings, bar/bat mitzvahs, and christenings; and holiday celebrations or other special events. Those living in condos and other homeowner communities often use the community association’s clubhouse and other common areas, like the pool area, for their private parties and events. While each community association has its own policy and rules in terms of the types of events that are permissible, it’s also important that the board understands the risks involved, including when the association is not holding the event.
Transferring the Association’s Exposure
Some of the potential risks of allowing unit owners to hold events at the community clubhouse and other common areas include slips and falls, particularly around the pool area, liquor liability if guests over-imbibe and get injured on the property or have a car accident on the way home, and property damage. Community associations carry general liability insurance, including umbrella liability, but it’s also smart for them to transfer their exposure to the event host.
The association should require the event host/organizer to carry event liability insurance, including liquor liability coverage, and for the association to be included as an additional insured on the policy. Ensure the association requires a certificate of insurance to be issued to verify that policy limits are sufficient. In addition, if there are vehicles involved in the event, for example, to make deliveries etc., make sure the event host has the proper commercial auto insurance in place.
If the community association is the one holding the event, it needs to secure host liquor liability insurance. If personal vehicles are being used to bring chairs, tables, supplies, etc. to the event, be sure the association’s insurance program includes hired and non-owned auto coverage.
In addition, before any invitations are sent, the association should have an established alcohol policy in place. The board should develop and implement a written policy on how alcohol is to be served and how the board and/or servers will deal with visibly intoxicated persons. Servers should not be members of the association and partake in the festivities. In addition, servers should be instructed to review identification when a drink is ordered.
It’s also important for community associations to continue to factor in the COVID-19 virus, particularly in light of the delta variant. Although states differ on policy, it’s wise to have any staff who serve guests continue to wear masks. Encourage hand hygiene and provide 60% alcohol hand sanitizer where soap and water are not readily available. If possible, modify the space layout to prioritize outdoor activities, and eliminate food service buffet lines as much as possible.
