Insurance.
28 RCNY § 3-09
in effect§ 3-09 Insurance.
(a) General. The following is intended to serve as minimum requirements for housing companies in arranging an insurance program to provide protection against the usual hazards experienced during the course of operation. Since the same conditions may not prevail in all developments, separate studies should be made as to the actual exposures and hazards and the insurance coverage necessary to meet them. It is incumbent upon all housing companies to see that proper insurance coverage is maintained at all times and that coverages are modified or changed to meet changing conditions. Copies of all insurance policies and renewals shall be transmitted promptly to HPD. Furthermore, all insurance coverage that is maintained by housing companies must be issued by an insurance company in good standing licensed to issue insurance in New York State.
(b) Minimum required coverage.
(1) Upon opening a corporate or sales office.
(i) Public liability (Comprehensive General Liability Form) Minimum limits of $1,000,000 per occurrence, $2,000,000 annual aggregate for bodily injury and property damage.
(ii) Workers' compensation. As required by statute.
(iii) Disability benefits. As required by statute.
(iv) Blanket fidelity bond. Appropriate limits as determined by HPD.
(v) Hold up. Inside and outside. Money and securities. (Broad Form if possible where safe is located on premises.)
(2) Upon acquisition of site.
(i) Liability coverage. To be endorsed to include site and any buildings thereon.
(ii) Fire insurance. Housing company should obtain this coverage on its buildings and/or personal property.
(3) Upon commencement of construction of the limited-profit housing company development. The following coverages are generally supplied by the General Contractor pursuant to the terms of the construction contract. Contractors shall be required to submit the required policies delineated in this section to HPD before the commencement of any construction work and operations shall not be allowed to commence until coverage required has been approved by HPD.
(i) Contractor's public and protective liability and property damage. Contractor shall provide such coverage to protect him and his subcontractors against claims for property damage and personal injury, including accidental death, in the sum of $1,000,000 per occurrence, $2,000,000 annual aggregate bodily injury and property damage.
(ii) Owner's protective liability and property damage. Contractor shall provide such coverage to protect the housing company against claims for property damage and personal injury including accidental death caused by the operation of the contractor or his subcontractors during the performance of the work in the sum of $1,000,000 per occurrence, $2,000,000 annual aggregate bodily injury and property damage.
(iii) Workers' compensation. As required by statute.
(iv) Disability benefits. As required by statute.
(v) Fire and extended coverage insurance. Pursuant to the terms of the Construction Contract. It is recommended that a builder's risk "Completed Value" form of policy be used. Adequate coverage shall be maintained for any materials which are stored away for the development site. It is recommended that the housing company rather than the contractor obtain this coverage.
(vi) Boiler. Minimum of $1,000,000 pursuant to the terms of the Construction Contract. It is recommended that the housing company rather than the contractor obtain this coverage.
(vii) Payment and performance bond. Pursuant to the terms of the Construction Contract.
(4) Upon occupancy of buildings. Policies carried during the initial or construction periods of a housing development for which there is a continuing exposure thereafter may remain in force and the policies adjusted in accordance with requirements during later conditions.
(i) Comprehensive general liability. Minimum limits of $1,000,000 per occurrence, $2,000,000 annual aggregate for bodily injury including accidental death and property damage. This policy should include coverage for the maintenance or use of the premises as well as for all elevators which are located in the development.
(ii) All Risk Property Policy. Policy should be written in an amount equal to at least 90 percent of the insurable value of the development. The prior approval of HPD shall be obtained for a deductible clause in excess of $5,000. Fire policies shall contain a provision that the settlement of all fire losses shall be subject to the approval of HPD. Policies shall be endorsed to cover the interest of The City of New York, as first mortgagee.
(iii) Rents. The rental income of the development should be written on a 100 percent co-insurance basis.
(iv) Workers' compensation. As required by statute.
(v) Disability benefits. As required by statute.
(vi) Fidelity Bond. 3D Comprehensive form of policy is recommended for this coverage. The amount of the coverage shall be two and one-half times the value of the monthly rent roll plus any other fluid assets. However, in certain cases using the two and one-half times factor may make the amount of coverage unrealistic and the cost prohibitive for the risk involved. Therefore, HPD reserves the right to determine, on a case by case basis, what amount is sufficient. A rider should include coverage for a managing agent. Furthermore, for mutual housing companies, a rider can also be added to include the interest of all non-compensated officers, directors and committee members.
(vii) Boiler and machinery. HPD recommends a "Comprehensive" form of coverage be used or a rider be added to the "Broad" form to cover "Miscellaneous Electrical Equipment". The amount of insurance to be carried shall be sufficient to cover the maximum probable damage to the property of the development and property of others that may arise out of any accident occurring through the operation of such equipment, but in any event not less than $1,000,000. Policies shall be endorsed to cover the interest of the City of New York, as first mortgagee.
(viii) Directors and officers. For mutual housing companies. Minimum limit of $1,000,000.
(ix) Umbrella liability. The minimum requirement for under 150 units $1,000,000; 151 to 500 units $5,000,000; 501 to 1,000 units $10,000,000; over 1,001 units $15,000,000.
(x) Miscellaneous risks.
(A) Automobiles. Any vehicle owned by the housing company shall be covered by automobile liability insurance with minimum limits of $250,000/500,000 for bodily injury, including accidental death, and at least $100,000 for property damage. For damage to the vehicle itself, comprehensive fire and theft shall be obtained. For automobiles owned by employees and officers of the housing company, used on behalf of the company, proper liability coverage shall be obtained with limits of $250,000/500,000 for bodily injury including accidental death and $100,000 for property damage.
(B) Sales and management companies. Where the housing company employs independent sales or managing agents, these agents or their employees who are responsible for the handling of housing company monies shall, without expense to the company, be bonded by a Blanket Position Bond, in favor of the housing company and a copy of such Blanket Position Bond shall be submitted to HPD.
(C) Contractors, concessionaires, and similar professionals. In the event that repair, alterations, exterminating or any other work or services shall be performed by the housing company, the housing company shall require that all firms performing such operations, supply evidence that workers' compensation and public liability insurance are in force. The limits for liability shall be at least $500,000 for bodily injury and property damage, combined single limit. It may be that certain contractors and concessionaires, by the nature of the liability factor for the work being done, and the cost of the contract, would have a higher risk factor. In that event we reserve the right to require, on a case by case basis, a higher amount for bodily injury. The housing company and HPD shall be named as an Additional Insured.
(D) Commercial tenants and licensees. Must carry a minimum of $1,000,000 for bodily injury and property damage, combined single limit. It may be that certain commercial tenants and licensees, by the nature of their business, would have a higher bodily injury risk factor. In that event we reserve the right to require, on a case by case basis, a higher amount for bodily injury. The housing company and HPD shall be named as an Additional Insured.
(E) Architects and engineers. Must furnish evidence of their liability coverage.
(F) For subparagraphs (x)(C) and (x)(D) above, the housing company and HPD shall be named as an Additional Insured.
(G) Insurance coverage shall be reviewed prior to the anniversary date of each policy with respect to the adequacy of coverage. HPD may direct a housing company to increase the amount of its coverage to reflect current replacement value where appropriate.
(c) Notice of loss.
(1) The housing company shall give immediate notice to HPD of the occurrence of any damage to its property caused by fire or any other hazards, whether or not covered under any of the above insurance coverages.
(2) If damage to housing company property is sustained at other than normal business hours, the loss must be reported to HPD on the first regular business day following the occurrence.
(3) Personal injury or fatality as a result of a fire or other than natural causes must be reported to HPD immediately.
(4) In the event that a housing company decides to employ a Public Adjuster for the purpose of negotiating a settlement with its insurance company, the housing company must request approval from HPD in writing. Approval by HPD must be confirmed in writing to the housing company.
(5) Unless HPD exercises its rights under the mortgage to apply insurance proceeds to the mortgage, all checks in payment of losses shall clear through HPD Insurance Unit. HPD representatives will inspect to see that the damaged property has been restored to satisfactory condition, after which time the checks shall be released to the housing company.
(d) Cancellation. All policies shall provide for a minimum of thirty (30) days notification to HPD in the event of cancellation, amendment or alteration of a policy.
(e) Capital grant insurance requirements.
(1) The housing company shall cause to be placed and kept in force all forms of insurance needed to protect the company adequately or required by law, including but not limited to workers' compensation insurance, disability insurance, public liability, boiler insurance, and all risk property insurance. All of the various types of insurance coverage required for the benefit of the housing company shall be placed with such companies, in such amounts, and with such beneficial interest appearing therein as shall be acceptable to the housing company and the New York State Division of Housing and Community Renewal, and otherwise be in conformity with the requirements of the mortgage.
(2) The housing company shall provide or make provision for a managing agent's bond naming the New York State Housing Finance Agency as obligee with an amount and an insurance company acceptable to the housing company, the New York State Housing Finance Agency, the New York State Division of Housing and Community Renewal and HPD.
Source: City of New York, Charter, Administrative Code and Rules (American Legal Publishing XML export, codelibrary.amlegal.com)URL: https://codelibrary.amlegal.com/codes/newyorkcity/latest/NYCrules/0-0-0-53952Fetched: 10/24/2026