Miami Condo Insurance After Surfside: What the Law Now Requires

Surfside changed more than how Miami talks about buildings. It changed what Florida law requires associations to carry, what lenders will accept, and what a gap in the master policy means for the person who owns the unit. Three of those things are often explained vaguely or not at all.

Published October 5, 2026

What Florida Statute 718.111(11) Requires

The master insurance obligation sits in Chapter 718, the Florida Condominium Act. Section 718.111(11) requires every condominium association to maintain property insurance on the condominium property and association property.

Replacement cost

The association must obtain an independent appraisal of replacement cost at least every 36 months. Coverage must equal the full replacement cost of the building — not depreciated value, not market value.

Wind

For associations in counties designated as high-velocity hurricane zones — Miami-Dade and Broward are both on that list — the association must carry coverage against windstorm loss sufficient to cover a 250-year windstorm event. That is the probable maximum loss at a 0.4 percent annual probability, a specific engineering calculation tied to the structure, not a round policy limit.

Primary coverage for original installations

The association's policy must provide primary coverage for all portions of the condominium property as originally installed, or replacement of like kind and quality. This means the kitchen cabinets, flooring, appliances, and fixtures that existed when the unit was delivered to the original purchaser are the association's coverage responsibility, not the unit owner's.

Flood

The statute permits but does not require the association to carry flood insurance. In Edgewater, on Brickell, and anywhere in a FEMA AE or VE zone, most lenders will require it regardless of what the association carries.

Deductibles

The statute requires that deductibles be consistent with industry standards and prevailing practice for similar coverage. This is not a hard cap, but it gives standing to challenge an association that adopted an unrealistically high deductible primarily to reduce premiums.

What Changed After Surfside: SB 4-D and Its Structural Requirements

Senate Bill 4-D, signed in May 2022, added two structural requirements that interact directly with the insurance picture.

Milestone inspections. Buildings three stories or higher must undergo a milestone inspection when they reach 30 years of age — or 25 years if within three miles of the coastline — with reinspections every 10 years after that. A building that fails a milestone inspection, meaning the inspector finds substantial structural deterioration, must notify unit owners within 45 days. Any notice of substantial structural deterioration is the kind of document a buyer should request before signing a contract, and failing to ask is a risk that belongs to the buyer.

Structural integrity reserve studies (SIRS). Associations governing buildings three or more stories were required to complete a SIRS by December 31, 2024. The study must identify and fund the maintenance costs for load-bearing walls, floors, roofs, structural members, plumbing, electrical systems, and windows. After December 31, 2024, associations may no longer waive or reduce reserve funding for the structural components identified in a SIRS. For buildings whose associations had previously passed annual reserve waivers — once standard practice in Florida — this is a legal obligation that did not exist four years ago.

The SIRS requirement is where insurance and reserves converge. A building with fully funded structural reserves and a current milestone inspection presents a materially different risk profile to its insurer than one with deferred maintenance and an outdated study. The premium the association pays, and in some cases the availability of coverage at all, increasingly reflects that difference.

What Lenders Now Look For

Fannie Mae and Freddie Mac each issued guidance after Surfside that changed how loans secured by condominium units are underwritten. The relevant documents are Fannie Mae Selling Guide update SEL 2022-01 and Freddie Mac Bulletin 2021-38. Both agencies stated that loans on units in buildings with significant deferred maintenance, or in buildings with special assessments related to structural repairs, are ineligible for purchase in the secondary market.

In practice, when a lender underwrites a loan on a condominium unit, the lender must now determine whether the project meets condominium project eligibility requirements. Both agencies maintain project approval lists and exclusion lists. A building that appears on an ineligible list because its HOA has disclosed significant deferred maintenance, structural concerns, or unresolved code violations cannot support a conforming loan. The buyer would need to pay cash or find a portfolio lender willing to hold the loan.

Three things tend to get a building flagged:

A special assessment for structural components

An assessment to repair load-bearing elements, windows, or roofing is precisely what the agencies watch for. The direction of travel matters — a building that levied an assessment and completed the repair is different from one still mid-repair or that levied an assessment without resolving the condition.

Reserve funding below SIRS projections

An association that passed a reserve waiver in 2023 and then had to comply with the post-SB 4-D funding requirement may now show a gap between its actual reserve balance and where the SIRS says it should be. Lenders are scrutinizing this gap.

An incomplete or failed milestone inspection

A building that has reached inspection age but not completed a milestone inspection is technically out of compliance. Lenders are required to flag this in the project review.

For cash buyers the lender constraint does not apply directly, but it affects resale value. A unit in a project-ineligible building faces a compressed buyer pool because most buyers use financing. The lender risk becomes the seller's risk at exit.

The HO-6 Policy and What It Actually Covers

An HO-6 is the individual unit owner's policy. It covers two things the master policy does not: the owner's personal property and any improvements made above the original installed condition — by the current owner or any previous one. It also provides liability coverage inside the unit.

The scenario that loss-assessment coverage in an HO-6 is designed to handle is this: the building sustains damage from a named storm. The master policy carries a 5 percent wind deductible applied to the full insured value of the building. On an $80 million structure, that deductible is $4 million. The $4 million is assessed against unit owners in proportion to their ownership interest. A unit owner with a 0.5 percent undivided interest owes $20,000 — before their own unit is repaired at all. HO-6 loss-assessment coverage is the mechanism for paying that bill.

The size of the master policy's wind deductible, expressed as a dollar figure against the building's replacement cost appraisal, is a number worth knowing before closing. It is not a negotiating point. It is a factual condition of ownership in that building, and it belongs in due diligence alongside the association's meeting minutes and the reserve schedule.

What to Request Before Closing

The Florida Condominium Act gives buyers the right to receive a copy of the governing documents, the most recent year-end financial statements, and the current budget. These are usually delivered as a disclosure package, but a buyer's agent should confirm that the following are included:

Master policy declarations page

Carrier name, AM Best rating, policy limits, wind deductible (as both percentage and dollar figure), flood coverage if carried, and policy period.

Independent replacement cost appraisal

The statute requires one every 36 months. If the most recent appraisal is older than three years, the association is out of compliance — and the building may be underinsured against its own standard.

Current SIRS and funding schedule

The study itself and the association's current reserve balance against the projected funding requirement.

Any special assessments in the past three years

Including completed ones. The reason for an assessment and whether the underlying condition was resolved are both relevant.

Any milestone inspection report

Required for buildings 25 or more years old. A Phase 2 report — meaning the inspection found substantial structural deterioration requiring further engineering review — is the document a buyer most needs to see and is most often not mentioned.

If the association cannot or will not produce any of these within the disclosure period, that is information too. An association that is current on its statutory obligations has no reason to delay producing the documents that prove it.

Stefania Riverin, Licensed Real Estate Sales Associate · FL SL3620067 · Brokered by NB Elite Realty · 1101 Brickell Ave, Miami, FL 33131 · Equal Housing Opportunity. This post describes Florida statutory requirements and general lending guidance as of October 2026. It is not legal advice. For questions specific to a building or transaction, consult a licensed Florida attorney.