Does this apply to my association?
The rule directly applies to covered DUCIOA communities created on or after September 30, 2009. Legacy, small, limited-expense, and nonresidential communities require separate applicability review.
Section 81-313 does not govern every Delaware HOA or condominium. Formation date, size, declaration elections, expense limits, and residential use matter.
What coverage does my association need?
HOA requirements
DUCIOA planned-community HOA
- Does this apply to my association?
- Covered post-September 30, 2009 planned communities. Communities with ≤20 units or qualifying limited expenses are excluded unless the declaration adopts the Act. Legacy and nonresidential rules may also alter coverage.
- How much coverage do I need?
- No statutory dollar minimum or formula. The association must maintain fidelity insurance to the extent reasonably available.
- What should I prepare?
- The law gives no dollar formula or list of people, losses, policy form, renewal schedule, or test for “reasonably available.” Review the governing documents and available policy terms.
- Who and what must coverage include?
- Section 81-313 does not identify insured people, dishonest acts, named perils, or a fidelity-bond alternative.
- Are there exceptions or waivers?
- Unavailability requires prompt owner notice. It is not an owner-vote waiver. All-nonresidential communities may vary or waive this section.
- When do I need coverage?
- Coverage starts no later than the first sale to someone other than the developer and continues afterward. Cancellation or nonrenewal requires 30 days’ mailed notice.
- What records do I need?
- Insurer must issue a certificate or memorandum to the association and, on written request, owners and security-interest holders. No government filing is specified.
Condominium requirements
DUCIOA condominium association
- Does this apply to my association?
- Covered post-September 30, 2009 condominiums. Condominiums with ≤20 units are excluded unless their declaration adopts the whole Act. Section 81-313 does not automatically apply to preexisting communities.
- How much coverage do I need?
- There is no stated minimum or formula. Maintain fidelity insurance to the extent reasonably available.
- What should I prepare?
- For older communities, first confirm that this section applies. Beyond requiring fidelity insurance, the law gives no details about the amount, people, losses, or policy form.
- Who and what must coverage include?
- No covered-person list, named peril, or bond-equivalency language appears in § 81-313.
- Are there exceptions or waivers?
- Promptly notify owners if coverage is not reasonably available. There is no residential owner-vote waiver.
- When do I need coverage?
- Coverage starts no later than the first sale to someone other than the developer. Cancellation or nonrenewal requires 30 days’ mailed notice.
- What records do I need?
- Provide a certificate or memorandum to the association and requesting owners or security-interest holders. No regulator filing is required.
How do I prepare to buy?
Classify the community by formation date, type, unit count, expense limits, and declaration elections.
Review governing documents and risk exposure because the statute provides no amount formula.
Obtain fidelity insurance if reasonably available and keep the insurer’s certificate or memorandum.
If unavailable, promptly deliver the required notice to every owner and retain proof.
Common Questions
Does Delaware state a minimum dollar limit?
No. Section 81-313 requires fidelity insurance to the extent reasonably available but gives no amount formula.
Does the law list who must be covered?
No. Compare the people and losses covered by the policy with the governing documents and the association’s funds at risk.
Is unavailability the same as a member waiver?
No. If required insurance is not reasonably available, the association must promptly notify owners.
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