ARTICLE VI

INSURANCE

Section 1. Insurance on Maintenance Property: The Association shall maintain insurance covering all insurable improvements located or constructed upon the Maintenance Property owned by the Association, including without limitation: a policy of property insurance to cover loss or damage by fire and other perils normally covered by the standard extended coverage perils endorsement; a comprehensive policy of public liability insurance to protect against bodily injury, including death to persons, personal injury, and property damage liability arising out of a single occurrence; comprehensive fidelity coverage or fidelity bonds to protect against dishonest acts on the part of officers, directors, trustees and employees of the Association and all others who handle or are responsible for handling funds of the Association; and coverage against such other risks of a similar or dissimilar nature, and on such property, as the Association may deem appropriate from time to time, including personal liability insurance to protect the directors and officers of the Association from personal liability in relation to their duties and responsibilities in acting as directors and officers of the Association.

Section 2. General Provisions of Insurance Policies: All policies of insurance carried by the Association shall be carried in blanket policy form naming the Association as insured, or its designee as trustee and attorney-in-fact for all Owners, and each Owner shall be an insured person under such policies with respect to liability arising out of any Owners membership in the Association. The policy or policies shall contain a standard non-contributory First Mortgagee's clause in favor of each First Mortgagee and a provision that it cannot he cancelled or materially altered by either the insured or the insurance company until thirty (30) days' prior written notice thereof is given to the insured and each First Mortgagee, insurer or guarantor of a First Mortgage. The Association shall furnish a certified copy or, duplicate original of such policy or renewal thereof, with proof of premium payment and a certificate identifying the interest of the Owner in question, to any party in interest, including First Mortgagees, upon request. Any such Owner's policy shall also contain waivers of subrogation. All policies shall contain waivers of any defense based on invalidity arising from any acts or neglect of an Owner where such Owner is not under the control of the Association.

Section 3. Association Insurance as Primary Coverage: If at the time of any loss under any policy which is in the name of the Association, there is other insurance in the name of any Owner and such Owner's policy covers the same property or loss, or any portion thereof, which is covered by such Association (continued next page)


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