Does this apply to my association?
Determine whether the property is a non-condominium common-interest community or a condominium, then apply the correct unit threshold and management-company provisions.
Illinois condominium rules overlap. Check the unit count, residential use, management control, and who holds the funds before selecting a limit.
What coverage does my association need?
HOA requirements
Non-condominium common-interest community
- Does this apply to my association?
- A common-interest community association with 30 or more units.
- How much coverage do I need?
- Maximum amount commercially available or reasonably required to protect funds in association custody or control. A responsible management company follows the same standard for funds in its custody at any time.
- What should I prepare?
- The law gives no numeric formula or method for choosing the amount. Ask for the coverage amount, available quotes, and the association’s reason for selecting it.
- Who and what must coverage include?
- Persons controlling or disbursing association funds are covered. The management-company bond protects funds it holds or administers. Named perils are not enumerated.
- Are there exceptions or waivers?
- No owner waiver. Associations under 30 units are outside § 1-55’s mandate. A contract may shift the cost to the management company.
- When do I need coverage?
- Obtain and maintain coverage. The law gives no fixed renewal interval or date for measuring the amount.
- What records do I need?
- The management company must furnish its fidelity bond to the association. No government filing is stated.
Condominium requirements
Condominium association
- Does this apply to my association?
- Section 12’s primary fidelity rule applies at 6+ dwelling units. Section 18(g) adds an overlapping rule at 30+ units. Manager sole-access safeguards apply to community associations with 6+ residential units.
- How much coverage do I need?
- Cover the full amount of association funds and reserves held by the association or management company. The expired $250,000 fallback in § 18(g) is not a current cap.
- What should I prepare?
- Sections 12 and 18(g) overlap. For a covered condominium, use the full amount of funds and reserves held by the association or management company.
- Who and what must coverage include?
- Persons controlling or disbursing funds are covered, including the managing agent and employees. Manager-firm and association fund handlers are included under § 18.7(d). Named perils are not specified.
- Are there exceptions or waivers?
- No residential owner-vote waiver. Section 12 may be varied or waived when every unit is restricted to nonresidential use.
- When do I need coverage?
- Maintain coverage. Section 12 addresses policies issued or renewed on or after June 1, 2015. The insurer gives at least 10 days’ written cancellation or nonrenewal notice under § 18.7(d).
- What records do I need?
- The management company furnishes the bond to the association. The association is the direct obligee under § 18(g). No government filing is stated.
How do I prepare to buy?
Classify the community as condominium or non-condominium and confirm unit count and residential-use restrictions.
Inventory all association funds and reserves held by the association and management company.
For a non-condominium 30-plus-unit community, document the commercially available or reasonably required amount. For a covered condominium, use full custodial funds plus reserves.
Obtain and retain the management-company bond and verify cancellation-notice and obligee provisions where applicable.
Common Questions
Do Illinois HOAs and condominiums use the same formula?
No. Section 1-55 governs 30-plus-unit non-condominium communities, while condominium provisions begin at six dwelling units and generally require all custodial funds plus reserves.
Is $250,000 a current condominium cap?
No. The temporary fallback in § 18(g) expired one year after September 21, 1985.
Can a residential condominium waive the bond?
The cited statutes provide no residential owner-vote waiver. Section 12 may be varied for an all-nonresidential condominium.
Calculate coverage and read the law
Coverage Calculator
Estimate a starting amount using your association's financial information.
Open calculator