Oregon HOA Insurance Requirements

Section 1: Overview — How HOA insurance is regulated in Oregon

Oregon imposes a statutory association insurance mandate on both condominiums, under the Oregon Condominium Act, and planned communities, under the Oregon Planned Community Act, each through its own insurance section, so unlike most states, planned communities in Oregon aren't in a covenant-only insurance posture.¹² The condominium insurance section is ORS 100.435, and the planned-community insurance section is ORS 94.675, supplemented by the blanket all-risk section at ORS 94.680 and the individual-lot specification section at ORS 94.685.¹²³⁴ Both Acts are state-specific Oregon statutes rather than verbatim adoptions of the Uniform Condominium Act or the Uniform Common Interest Ownership Act, so each insurance provision is read on its own terms.¹² In both statutes the obligation to insure the units or dwellings is keyed to building structure and to which entity holds repair-or-reconstruct authority, so a planned community of detached homes may leave dwelling coverage to individual owners.¹³⁴ Both statutes require fidelity bond coverage, added by 2019 c.66, but neither mandates directors-and-officers liability insurance, which remains declaration-driven or lender-driven.¹² Within the national framework, Oregon sits with the minority of states that extend a statutory insurance mandate to planned communities as well as condominiums, set against an acute wildfire and seismic market.¹⁰⁹ The sections below detail the two mandates, the classification question, and the federal overlay.

Section 2: The statutory insurance framework

2A. The two insurance mandates (condominium and planned community)

The condominium mandate sits at ORS 100.435. Where the bylaws give the association sole authority to decide whether to repair or reconstruct a damaged unit, the board must obtain and pay for, as a common expense, property insurance covering both the common elements and the individual units — fire, extended coverage, vandalism, and malicious mischief — and comprehensive liability insurance covering the association, its manager, the board, and unit owners incident to ownership or use of the property, with a cross-liability endorsement.¹ Where the bylaws instead require individual owners to insure their units, the board must still insure the common elements for both property and liability.¹ The board must obtain a waiver of subrogation in favor of the board where reasonably available.¹

The planned-community mandate sits at ORS 94.675, and this is the defining Oregon feature: an Oregon planned community carries its own statutory insurance mandate. The board of a homeowners association must obtain and maintain insurance for all insurable improvements in the common property against fire and other hazards covering full replacement cost, expressly qualified by whether the insurance is available at reasonable cost, plus a public liability policy covering all common property and damage or injury caused by association negligence.² Premiums are a common expense.² Where the declaration or bylaws give the association sole authority to decide whether to repair or reconstruct a unit, ORS 94.680 requires the board to obtain blanket all-risk insurance for the full replacement cost of all structures in the planned community, and the governing documents must then set requirements for repair or reconstruction, the time within which it must begin, and the actions the board must take if damage isn't repaired or if proceeds exceed or fall short of the cost.³ Both statutes are state-specific and don't carry the full Uniform Common Interest Ownership Act Section 3-113 machinery, so their coverages, valuation, and proceeds handling are read from the Oregon text.¹²

Neither statute sets a dollar minimum for liability or property coverage; the valuation standard for planned-community common property and blanket all-risk structures is full replacement cost.²³ On deductibles, both statutes let a policy carry a deductible set in the declaration or bylaws, and both allow the board, by resolution and after considering availability, cost, and loss experience, to obtain a deductible exceeding a declaration-imposed maximum, capped at the greater of the maximum acceptable to the Federal National Mortgage Association or $10,000.¹² Both require the board to deliver or mail the resolution and an owner notice within 10 days of adoption.¹² Both statutes also require fidelity bond coverage for all persons with access to association funds and for computer fraud and funds-transfer fraud, in an amount at least equal to association funds plus any U.S. government obligations the association holds; this coverage was added by 2019 c.66, applies to communities created before, on, or after January 1, 2020, and after the turnover meeting owners may vote annually to reduce or waive it.¹²

2B. Classifying the community and the building-structure keying

A manager must first determine whether a community is a condominium, governed by ORS chapter 100, or a planned community, governed by ORS chapter 94, because the applicable insurance section depends on the community type; applying one Act's section to the other community type is an error.¹² In both statutes the property obligation on units or dwellings is keyed to structure and to repair authority. A condominium association insures the units only where the bylaws give it sole repair authority; otherwise it insures the common elements and owners insure their units.¹ A planned community insures all structures on a blanket all-risk basis only where the association has sole repair authority under ORS 94.680; a planned community of detached single-family homes typically leaves dwelling coverage to owners, and ORS 94.685 directs the declaration or bylaws to specify the insurance an owner must obtain, any insurance an owner is precluded from obtaining, deductible responsibility, and whether owner and association coverage may be brought into contribution.³⁴ The planned-community fidelity provision applies to Class I and Class II communities created before, on, or after January 1, 2020.² The practical sequence is to classify the community, apply the correct statute's insurance section, then read the recorded declaration against it.¹²

2C. The declaration, corporate law, and the federal and market overlay

Both statutes permit the declaration or bylaws to vary many insurance defaults, including deductible allocation and the specification of owner-obtained insurance, so the recorded declaration read against the statutory backstops is the practical rulebook for any community.¹⁴⁶ Fidelity bond coverage is statutory in both Acts, but directors-and-officers liability insurance isn't mandated by either insurance section and is driven by the declaration or by lender requirements.¹² Where the association is incorporated, the Oregon Nonprofit Corporation Act (ORS chapter 65) permits indemnification of directors and officers but doesn't require insurance.⁵ Federal and secondary-market requirements sit on top of state law: Fannie Mae, Freddie Mac, FHA project approval, and the National Flood Insurance Program impose their own conditions. Fannie Mae Selling Guide B7-3-03 requires master property limits at least equal to 100 percent of the replacement cost of the project's improvements, treats actual-cash-value settlement as not acceptable, and caps the property deductible at 5 percent of coverage, revised to a $50,000 per-unit cap effective July 1, 2026 under Lender Letter LL-2026-03; Fannie Mae also requires fidelity or crime coverage for most projects and accepts a state statutory fidelity requirement in place of its own where one exists.⁷⁸ These overlays frequently exceed either statutory floor. The Oregon market context is distinct from any statutory mandate: wildfire exposure in the wildland-urban interface, brought into focus by the September 2020 Labor Day fires, has reshaped availability and cost in exposed communities; Cascadia Subduction Zone seismic risk is significant, with earthquake typically excluded from standard property policies and purchased separately; and winter and riverine or coastal flooding bring the National Flood Insurance Program into play in Special Flood Hazard Areas.⁹¹¹

Section 3: Coverage allocation and compliance obligations

A. Association coverage obligations

For a condominium, the Oregon Condominium Act requires the association to insure the common elements for property and liability at all times, and to insure the individual units as well where the bylaws give the association sole repair-or-reconstruct authority; this obligation is mandatory, though the triggering allocation of repair authority is set in the bylaws.¹ For a planned community, the Oregon Planned Community Act requires the association to insure all insurable improvements in the common property at full replacement cost when available at reasonable cost, plus public liability, and to add blanket all-risk coverage on all structures at full replacement cost where the association holds sole repair authority.²³

B. Coverage allocation between association and owners

The association master policy covers common elements or common property and, in structure-sharing communities, the units or structures; it doesn't by default cover a unit owner's interior betterments, personal property, or, in a detached-home planned community, the owner's home.¹⁴ A condominium owner typically carries an individual unit policy for interior improvements, personal property, loss assessment, and the association deductible; in a planned community, ORS 94.685 directs the declaration or bylaws to specify the insurance the owner must carry, making owner coverage central for detached homes.¹⁴ These allocations may be varied by the declaration.⁴

C. Deductibles, proceeds, and repair-or-replace

Under both statutes the deductible amount is set in the declaration or bylaws, and for planned-community common property the deductible is added back to the policy face amount when testing whether coverage equals full replacement cost.² Both statutes let the board raise the deductible by resolution up to the greater of the Fannie Mae maximum or $10,000, and both let the board assign deductible responsibility where the governing documents are silent (ORS 100.435 for condominiums created before September 27, 2007, and ORS 94.676 for planned communities created before that date or subject to ORS 94.572).¹⁶ Boards may require owners to carry a policy covering the association deductible for which the owner may be responsible, exposing owners to that amount and to common-expense assessment for uninsured loss.¹⁶ The repair-or-replace obligation is keyed to repair authority: the condominium coverage duty follows the bylaw allocation, and the planned-community documents must set repair timing and the handling of proceeds that exceed or fall short of cost where the association has sole authority.¹³

D. Fidelity, D&O, and disclosure

Fidelity bond coverage is a statutory requirement under both Acts, in an amount at least equal to association funds plus U.S. government obligations held, subject to an annual owner vote to reduce or waive after turnover.¹² Directors-and-officers coverage isn't required by either insurance section and is declaration-driven or lender-driven, with the Oregon Nonprofit Corporation Act supplying indemnification authority rather than an insurance requirement.⁵ Fannie Mae, Freddie Mac, and FHA project reviews commonly require the association to make the master policy or a certificate available to owners, purchasers, and lenders.⁷

Section 4: Recent legislative and judicial activity

A. Recent bills

A third 2025 measure, House Bill 3746, signed July 24, 2025 and effective January 1, 2026, amends ORS 12.135 and ORS chapters 94 and 100 to shorten the construction-defect statute of ultimate repose from ten years to seven — with a one-year discovery extension for defects found in years six and seven — and to add moisture-intrusion inspection duties near years two and six for condominiums; it affects association construction-defect and subrogation timelines rather than the insurance sections directly.¹⁴

B. Recent appellate rulings

A review of Oregon Court of Appeals and Oregon Supreme Court opinions from July 2023 through July 2026 identified no published appellate decision squarely addressing a condominium or planned-community association's insurance obligations, master-policy coverage allocation, deductible disputes, or proceeds-and-rebuild questions under ORS chapter 100 or ORS chapter 94.¹⁵ The most material recent pressure on Oregon association insurance is market-driven rather than judicial.

C. Active legislative debates

Wildfire insurance availability remains the active front: a 2026 measure modeled on Colorado's mitigation-discount law, which would have required insurers to file wildfire rating models with the Department of Consumer and Business Services and to credit homeowner mitigation, cleared committee but died before a floor vote when the short session adjourned.¹⁶ The SB 85 agency report due February 2, 2026 is expected to frame any further legislative action on coverage and mitigation.¹³

Section 5: National positioning and related coverage

Oregon falls within the group of states that impose a statutory insurance mandate on associations, and it's distinctive because it applies that mandate to both condominiums (ch. 100) and planned communities (ch. 94) through state-specific rather than uniform statutes.¹² That places it apart from comprehensive non-uniform prescriptive states such as California, under the Davis-Stirling Act, and Florida, under Chapter 718, which set more granular coverage and appraisal requirements, and apart from covenant-primary states such as Alabama and Arkansas, where planned communities carry no statutory insurance mandate.¹⁰ Oregon sits with the minority that reaches planned communities, and wildfire and Cascadia seismic exposure shape its real market.⁹ For a multi-state operator entering Oregon, the first step is to classify each community and apply the correct statute's insurance section, treating wildfire and seismic availability as an Oregon-specific constraint. Oregon hasn't amended either insurance section in response to the wildfire crisis; its 2025 wildfire measures target mapping, mitigation, and carrier conduct rather than the association mandates at ORS 100.435 and ORS 94.675.¹²¹³

HOA Weekly updates its Oregon Insurance Requirements coverage quarterly as the legislature and the Oregon Supreme Court act and as the property-insurance market shifts. Federal frameworks, including Fannie Mae, Freddie Mac, FHA, NFIP, and FHA fair-housing accommodation rules, also apply to Oregon associations regardless of the state framework, with fuller treatment to follow once that coverage is built out.

1. Oregon Condominium Act, ORS 100.435 (Insurance for individual units and common elements; fidelity bond), Oregon Revised Statutes ch. 100 ↩
2. Oregon Planned Community Act, ORS 94.675 (Insurance for common property; fidelity bond coverage), Oregon Revised Statutes ch. 94 ↩
3. ORS 94.680 (Blanket all-risk insurance), Oregon Revised Statutes ch. 94 ↩
4. ORS 94.685 (Specification of insurance for individual lots), Oregon Revised Statutes ch. 94 ↩
5. Oregon Nonprofit Corporation Act, ORS ch. 65 (indemnification of directors and officers) ↩
6. ORS 94.676 (Insurance deductible for certain planned communities), Oregon Revised Statutes ch. 94 ↩
7. Fannie Mae Selling Guide B7-4-02, Fidelity/Crime Insurance Requirements for Project Developments (accepts state statutory fidelity requirements in place of its own) ↩
8. Fannie Mae Lender Letter LL-2026-03, Property Insurance and Project Standards (100% replacement-cost master property coverage; deductible cap revised to $50,000 per unit effective July 1, 2026) ↩
9. Oregon Division of Financial Regulation, Earthquake insurance (earthquake excluded from standard homeowner, condo, and renter policies; separately purchased; Cascadia Subduction Zone risk) ↩
10. California Davis-Stirling Act (Civil Code) and Florida Statutes ch. 718.111(11), for comparative state insurance mandates ↩
11. Oregon Division of Financial Regulation, Wildfire insurance (market availability and cost after the 2020 Labor Day fires) ↩
12. Oregon Senate Bill 83 (2025 Regular Session), 2025 c.590, official measure page (wildfire hazard map repeal) ↩
13. Oregon Senate Bill 85 (2025 Regular Session), 2025 c.217, official measure page (DCBS and State Fire Marshal wildfire insurance recommendations; report due February 2, 2026) ↩
14. Oregon House Bill 3746 (2025 Regular Session), construction-defect repose and moisture-inspection amendments, effective January 1, 2026, official measure page ↩
15. Oregon Judicial Department, Court of Appeals Opinions index (reviewed July 2023–July 2026; no qualifying association-insurance opinion identified) ↩
16. Oregon Capital Chronicle, 2026 wildfire insurance mitigation-model bill (cleared committee, died before floor vote) ↩