AB 350 is a new bill that was enacted relating to management agreements involving common interest communities and its community managers. The new bill indicates and specifies the conditions of the management agreement between a common interest community and its community managers. AB 350 states that the management agreement must specify the varieties of insurance that each of the contracting parties must acquire; this insurance comprises of a liability policy covering errors and omissions or professional liability, or a surety bond in a quantity of at least $1 million. Proof of a fidelity bond is also called for. Additionally, the management agreement must provide for which of the contracting parties will supply a fidelity bond. AB 350 became active on July 1st, 2009.
Eric is the Chief Marketing Officer of JW Surety Bonds. With years of experience in the surety industry, he is also a contributing author to the surety bond blog.