Volunteers decide. D&O defends them.
Directors and officers liability for community association boards, committee members, volunteers and the property manager: breach of fiduciary duty, discrimination and fair housing claims, failure to maintain, election and assessment disputes, non-monetary suits and defense costs, set to the amounts the Davis-Stirling Act names for volunteer protection.
By Sam Alishahi · CA Insurance License #4348151 · Reviewed October 2026 · How this page is researched
The board is sued for what it decided, not for what broke
An association board approves budgets, levies assessments, enforces rules, hires the manager, decides whether to sue a builder and runs elections. Every one of those is a decision somebody can challenge, and the general liability policy does not respond to a lawsuit over a decision. Community association D&O does. It is written on a claims-made basis for the association, its past and present directors and officers, committee members, volunteers and often the management company while acting for the board, with defense costs that in many forms sit outside the limit.
California ties volunteer protection to this policy. Under Civil Code section 5800, a volunteer director or officer of a residential or mixed-use association is not personally liable beyond the association's insurance for a good-faith act within their duties, but only if the association carries both general liability and individual director and officer coverage of at least five hundred thousand dollars each where there are one hundred or fewer separate interests, or one million dollars each above that. Drop the D&O and the volunteer's personal assets are back in play.
The standard the board is judged by comes from the Corporations Code. Section 7231 asks a director of a nonprofit mutual benefit corporation to act in good faith, in what they believe is the corporation's best interest, with the care an ordinarily prudent person would use, and lets them rely on managers, accountants, lawyers and committees after reasonable inquiry. A D&O policy is what pays to prove the board met that standard. I quote limits from one million to five million dollars depending on unit count, litigation history and whether the association employs staff.
- Who is insuredDirectors, officers, committee members, volunteers and often the manager when acting for the board.
- Breach of dutyBudget, assessment, reserve, enforcement and contract decisions challenged by owners.
- Discrimination and fair housingClaims over accommodation requests, rentals, pets and parking rules.
- Non-monetary claimsSuits seeking an injunction or a new election, with defense cost coverage.
What underwriters will ask
Having these ready means I can go to market on the first call. The quote form asks for the same things, and anything you don’t know yet can wait.
- Association: name, number of separate interests, condo, townhome or planned development, and the year it was formed.
- Board: number of directors, committees, any paid staff and the management company.
- Finances: annual assessments, reserve balance and any special assessments in the last three years.
- Litigation: pending or threatened suits, owner complaints, fair housing inquiries and defect claims.
- Current policy: declarations page, limit, retroactive date and whether defense is inside or outside the limit.
- Documents: CC&Rs, bylaws and the most recent election rules.
HOA directors and officers insurance, answered
Is D&O required for a California HOA?
The Davis-Stirling Act does not order every association to buy it, but Civil Code section 5800 makes volunteer directors' personal liability protection depend on the association carrying both general liability and individual director and officer coverage at the stated amounts: five hundred thousand dollars each for one hundred or fewer separate interests, one million dollars each above that. Most governing documents also require it.
What does HOA D&O not cover?
Bodily injury and property damage belong to the general liability policy, and D&O forms exclude them. Fraud, dishonesty and personal profit are excluded once established, and most forms exclude the cost of the repair itself in a failure-to-maintain suit while still defending the board. Read the exclusions with me before you rely on it.
Does it cover the management company?
Many community association D&O forms include the property manager as an insured for acts performed on the board's behalf, and some require an endorsement. The manager should still carry its own errors and omissions policy, because the association's D&O is not meant to cover the manager's other clients.
Are defense costs inside or outside the limit?
It depends on the form. Some community association D&O policies pay defense outside the limit, so a long lawsuit does not eat the money set aside for a judgment or settlement. Others count defense within the limit. I point this out on every quote because it changes what a one million dollar limit is worth.
What standard are directors held to?
Corporations Code section 7231 requires a director of a nonprofit mutual benefit corporation to act in good faith, in what they believe is the corporation's best interest, with the care of an ordinarily prudent person in a like position, and allows good-faith reliance on officers, professionals and committees. A director who meets that standard is not liable for an alleged failure of duty, and the D&O policy funds the defense that shows it.
Does the policy cover claims from before we bought it?
Only back to the retroactive date on the policy, and only for claims first made during the policy period. When you change insurers I match or extend the retroactive date so the board does not lose years of coverage.
Do you offer HOA directors and officers insurance outside California?
Yes. Clients across the country send the same quote form. Sam Alishahi is licensed in 49 states and Washington, DC and places policies there directly. In Florida, where Sam's licenses are still being issued, a partner agency in your state helps in the meantime. The shopping across carriers works the same way. Rules, minimums and markets differ by state — see insurance requirements by state.
Protect the people who volunteered.
Send me the current declarations page, the unit count and any pending disputes. I'll quote D&O at the Davis-Stirling amounts and above, with the manager included and the defense wording explained.
Alishahi Insurance · Saman Alishahi, independent insurance broker, California License #4348151. General information, not a quote or a promise of coverage; coverage depends on underwriting and the terms, conditions and exclusions of the policy actually issued.
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