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SB 2896

AN ACT RELATING TO PROPERTY -- CONDOMINIUM OWNERSHIP

2026 Regular Session Introduced by Pete Appollonio and 4 co-sponsors

SB 2896 clarifies and modernizes condo insurance: it defines master vs. unit insurance, how deductibles and proceeds are handled, and requires transparency and owner access to appr

05/20/2026 Referred to House Corporations
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Bill Summary · SB 2896

Summary of SB 2896 (Rhode Island, 2026)

Main purpose and intent

SB 2896 aims to clarify and modernize condominium insurance provisions in Rhode Island. It focuses on how master (association) insurance deductibles and uninsured losses are handled between the condominium association and individual unit owners, requires unit owners to insure their units when the association does not, and authorizes boards to manage and apply insurance proceeds for repairs. The act takes effect upon passage.

Key provisions and changes

  • Insurance ownership and funding (Section 34-36-29):

    • The condominium association (manager, management committee, or association of unit owners) must obtain property insurance against fire and other hazards, with premiums treated as common expenses.
    • Insurance is written in the association’s name as trustee for unit owners in the percentages specified in the declaration.
    • A unit owner’s policy remains allowed and can be primary for amounts not payable due to the association’s deductible, subject to existing rules.

  • Unit owner access to insurance information (Section 34-36-29, subsection (b)):

    • When a unit is damaged and covered by the association’s policy, the unit owner can request a copy of the insurance company’s damage appraisal within 14 days of the request or of the association’s receipt of the appraisal.
    • If coverage is denied or deemed to be below the deductible, the owner is entitled to a copy of the denial or determination letter.

  • Applicability and pre-1982 condominiums (Section 34-36.1-1.02):

    • Reiterates how condominiums created after July 1, 1982 are governed.
    • For condominiums created before July 1, 1982, certain provisions may be voluntarily accepted and recorded; various listed sections apply to events after July 1, 1982.
    • Clarifies interaction with older governance documents and amendments.

  • Insurance requirements and detailing (Section 34-36.1-3.13):

    • The association must maintain property insurance for common elements and, if required, for units (including improvements and betterments) to at least 80% of the actual cash value at purchase and renewal, excluding land and typical exclusions.
    • Liability insurance is also required, with minimum amounts set by the executive board (and not less than the declaration).
    • If certain insurance is not reasonably available, notice must be provided to unit owners, and the association may carry alternative coverage.

  • Proceeds and damage allocation (Section 34-36.1-3.13 and subsections (d), (e), (h), (i)):

    • Insurance proceeds are payable to an insurance trustee or the association, not directly to mortgagees, and are held in trust for owners and lienholders.
    • Proceeds are first used to repair or restore damaged property, with specific rules on allocation of deductible and recovery between unit owners and the association depending on whether the loss affects common elements, a single unit, multiple units, or both.
    • If the entire condo is not rebuilt, proceeds are allocated according to the nature of the loss and ownership interests, with potential reallocation of unit interests if rebuilding is not pursued.

  • Unit owner responsibilities (Sections 34-36.1-3.13 and 34-36.1-3.21):

    • If the association maintains property insurance, unit owners must maintain property insurance for improvements and betterments, and insure any deductible amounts not payable by the association.
    • If the association does not maintain property insurance, unit owners must insure their units as defined in the declaration/bylaws.

  • Nonresidential condominiums (Section 34-36.1-3.20):

    • Provisions may be varied or waived for condominiums restricted to nonresidential use.

Who would be affected

  • Unit owners: Potential changes to their insurance requirements, primary vs. secondary coverage in the event of losses, and access to appraisal information.
  • Condominium associations: New or clarified responsibilities for obtaining and managing master insurance, handling deductibles, allocating proceeds, and communicating with unit owners and mortgagees.
  • Mortgagees/Lienholders: Receives clarity on where insurance proceeds are deposited and how losses are processed.

Procedural and timeline notes

  • The act becomes effective upon passage.
  • Provisions include explicit timing for sharing insurance appraisals (14 days) and notice requirements (e.g., at least 30 days for deductible changes to be communicated to unit owners and mortgagees).

Overall impact

SB 2896 provides clearer, more predictable handling of insurance coverage, deductibles, and proceeds in condominium settings, enhances transparency for unit owners, and delineates responsibilities for both associations and individual owners concerning insurance and repairs.

Compiled from official sources — confirm details with the bill’s official record.

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