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How Action Property Management Secured Nearly $100,000 in Insurance Savings
A 119-unit seaside community in Laguna Beach faced a severe insurance crisis in late summer 2024.
Background
A 119-unit seaside community in Orange County faced a severe insurance crisis in late summer 2024. After decades of coverage with the insurance, the Association received a non-renewal notice citing multiple risk factors, including the age of the property, high wildfire scores, and proximity to the ocean. At the time, the Association was paying $90,000 annually for $42 million in property coverage.
The loss of coverage left the Association with no choice but to secure emergency insurance in the volatile excess market. The result: coverage dropped to $20 million, and the annual premium skyrocketed to $530,000 an increase of nearly 490%. To cover this sudden, unbudgeted expense, the Association was forced to:
- Levy an emergency special assessment of $3,608 per unit, payable within 90 days
- Implement a 20% mid-year dues increase
- Transfer funds from reserves to cover immediate costs
While homeowners cooperated fully, the financial impact was substantial, and it was clear that a long-term solution was urgently needed.
Action Property Management Intervention
Recognizing the unsustainable burden, Action Property Management immediately began exploring alternatives:
- Broker Transition – At the start of 2025, Action Property Management initiated a broker change to a firm specializing in difficult-to-place community associations.
- Strategic Market Shopping – Over several months, Action Property Management and the broker worked closely to secure competitive bids from multiple carriers. This effort resulted in new coverage totaling $305,000 annually a direct savings of $180,000 compared to the emergency policy.
- Refund of Unused Premium – Upon binding with the broker, Management promptly cancelled the prior coverage and successfully recovered $211,361 in unused premium for the Association.
- Risk Mitigation Program – Electrical Panel Upgrades – Understanding that long-term insurability required risk reduction, Action Property Management spearheaded a community-wide mandate requiring every homeowner to replace outdated electrical panels. Within 120 days, 100% compliance was achieved, with each homeowner investing approximately $4,500. This major infrastructure improvement significantly reduced the community’s risk profile.
Results
Thanks to Action Property Management’s persistence and strategic planning the Association was able to:
- Secure $42.5 million in total property coverage (slightly more than pre-nonrenewal levels)
- Lock in a prorated premium of $131,554.33 for an additional $22.5 million layer of coverage
- Achieve a combined annual insurance cost of $436,554, which is nearly $100,000 less than the prior year’s $530,000 bill while providing more coverage than ever before.
Conclusion
In one of the most volatile insurance markets California has ever faced, Action Property Management turned a devastating setback into a long-term win. Through:
- Proactive broker selection
- Persistent pursuit of better quotes
- Mandated risk-reduction improvements
Action Property Management not only saved the Association close to $100,000 annually, but also positioned the community for long-term stability and stronger insurability.
This case demonstrates the value of having dedicated, forward-thinking management transforming a crisis into measurable savings, preserving homeowner trust, and protecting the financial health of the Association.
Total Savings Secured: $100,000+ annually
- Improved Coverage: $42.5M vs. $20M
- Stronger Risk Profile: 100% upgraded electrical systems
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