A Growing Community: How Insurers Can Help HOAs Manage Their Expanding Risk Landscape

Homeowners’ associations (HOAs) have become one of the most significant segments of the American residential landscape. With approximately 373,000 associations across the country housing an estimated 77 million people, HOAs now represent roughly a third of the U.S. housing market. And they’re not slowing down. The segment is growing at a rate of about 5,000 new associations per year.

That expansion creates both opportunity and complexity for insurers. Associations vary widely in size, structure, and amenities, and the risks they face are evolving alongside changing resident expectations, more elaborate community events, and increasing demand for security services.

“Homeowners’ associations have an incredible footprint in the U.S. housing market, shaping the way millions of people live and interact within their communities. Their continued growth and increasing responsibilities make them a highly specialized segment that requires thoughtful risk management and insurance solutions,” said Nicole Reed, Vice President at Philadelphia Insurance Companies (PHLY).

A Broad and Attractive Market Segment

Nicole Reed, Vice President, Philadelphia Insurance Companies

The HOA category is broader than many people might realize. At PHLY, it includes community owner associations (COAs), property owners associations (POAs), and master associations that serve as umbrella structures over sub-associations. It also extends to commercial HOAs such as strip malls and planned unit developments (PUDs), as well as the occasional neighborhood association.

For PHLY, the fundamentals are clear: the association must have a board, established CC&Rs (conditions, covenants, and restrictions), and be properly registered as an association.

“It’s profitable business. It’s definitely a product that we want to write more of,” Reed said. “It does have its struggles sometimes on the GL side because of slips and falls or whatnot. But overall, it performs well.”

At Philadelphia Insurance Companies, the HOA product focuses on common areas — clubhouses, fitness facilities, tennis courts, pools, and other amenity infrastructure — while residential building coverage is handled through a separate condo product. That structure allows underwriters to tailor coverage more precisely to the exposures at hand.

Coverage Lines and the Risks HOAs Need to Watch

The primary coverage lines for HOAs include property, general liability, and crime, with additional considerations for liquor liability, abuse coverage, umbrellas, cyber liability, and auto coverage. Most midsize and small associations aren’t looking for enormous limits; they simply want dependable protection.

But the exposure landscape is shifting, driven in large part by the events and amenities that make HOAs attractive to residents in the first place.

“This is an area where HOAs are really competing with each other. The more events they have, the more attractive they are to new buyers,” Reed said. “We’re talking about food trucks coming in, national nights out, and weekly movie nights.”

The scale of these events can vary dramatically, from a simple community breakfast to a 10,000-person Fourth of July celebration featuring parades, food, and fireworks. That variability creates underwriting questions.

Pools and other water features remain a heightened area of concern. Reed noted a small uptick in drowning and near-drowning claims, underscoring the importance of proper fencing, self-latching gates, and appropriate signage.

“Making sure your fence is the appropriate height and width — including the spaces between the poles — is important because we’ve had cases where a child got through those spaces and gained access to the pool,” Reed said. “The signs need to be posted if they don’t have lifeguards, indicating that people are swimming at their own risk. The gates have to be the appropriate height and need to be self-locking.”

Security is another growing consideration. Reed’s research indicates that roughly 20% of HOAs are exploring hiring guards — armed, unarmed, gate-based, or foot patrol — while up to 44% have some form of security measure in place, whether cameras, gates, or other protective features.

Armed security introduces additional underwriting scrutiny. “Armed security introduces another layer of potential occurrence, so we’re going to ask a lot more questions with regard to armed personnel. That contract is going to be reviewed very closely,” Reed said.

Access-related issues can complicate emergency response as well, particularly in gated communities on private roads. Ensuring that police and emergency responders have access codes or keys is critical, especially when a gate guard may be summoned away from their post to assist elsewhere.

Experience, Flexibility, and Risk Management Support

Philadelphia Insurance Companies has been underwriting HOAs for more than two decades, and that experience shapes both its appetite and its approach to service. The carrier writes coverage on both an admitted and E&S basis, giving it flexibility to address harder-to-place risks that may involve prior losses or challenging exposures.

“I say yes more than I say no. I may ask some questions about a risk, but for me to say no, it’s got to be something that’s really out of the norm,” Reed said.

That flexibility extends to complex account structures. Auto coverage — which most states don’t permit on an E&S basis — can be written on an admitted basis alongside E&S general liability and property coverage on the same account. PHLY can also address niche exposures such as golf carts, with coverage placement depending on whether the carts are licensed for road use.

Beyond capacity and appetite, PHLY brings a full risk management team to the table, available for consultation on a wide range of issues.

“We will help if the insured needs advice and wants us to come out and meet with them. We will gladly do that,” Reed said. “A lot of what I see are one-off questions about signage verbiage for a pool or a lake, or even something to do with a gate.”

Ease of doing business is another priority. Agents can access PHLY’s HOA portal to input submissions directly, with no premium size cap, and several states are configured to feed submissions into the rating system for faster turnaround. A dedicated small business unit handles accounts with premiums of $25,000 and under, while a separate group handles larger accounts. And for agents who still prefer traditional submissions, that option remains available.

“I have agents and brokers that love portals, and I have others that do not and want to submit their application the traditional way. We’re absolutely receptive to that too,” Reed said.

As HOAs continue to expand in number and in their range of services, associations and their agents will need carriers who understand both the underwriting fundamentals and the evolving risks, from event exposures to security contracts to water safety. Partnering with an insurer that offers both breadth of appetite and hands-on risk management support can make a meaningful difference in how well an association is protected.

To learn more, visit the PHLY HOA page.

This article was produced by the R&I Brand Studio, a unit of the advertising department of Risk & Insurance, in collaboration with Philadelphia Insurance Companies. The editorial staff of Risk & Insurance had no role in its preparation.