We live in a private residency (a non-profit) where roads fees are collected to maintain the dirt/gravel roads & snowplow. We have posted signs to our community. Private; private drive, no trespassing. Do we need liability insurance?
Yes, yourhomeowners association should obtain liability insurance. Since the homeowners association owns the roads within the community, it has premises liability. As such, all homeowners, tenants, occupants, licensees, invitees and guests have a reasonable expectation of not getting injured while using the roadways within the community. The homeowners association has the duty to use reasonable care to maintain, repair and replace the roadways as may be necessary to maintain the roadways in a safe condition. If it fails to do so, the homeowners association may be liable for any property damage or personal injuries which may occur arising out of its negligence.
Generally, a homeowners association does not have a duty with respect to trespassers. However, if the homeowners association knows that it is likely that trespassers will enter upon the property (even if it posts no trespassing signs), it may have premises liability even to a trespasser.
Besides covering any potential damages which may be awarded to a claimant for property damage or personal injuries, liability insurance also provides for the defense by counsel selected by the insurance company of any potential claims that may be made against the homeowners association. Attorneys' fees and court costs can be quite substantial whether or not the homeowners association has any liability.