CT ‘captive’ insurance assistance for HOA, condo homeowners with crumbling foundations

By Deborah Goonan, Independent American Communities


For several years, IAC has been following the epidemic of crumbling concrete foundations in Connecticut. Many of the homes are part of a PUD (planned unit development with an HOA) or condominium, where two or more units share the same foundation.

The cost to replace failing concrete foundations is massive — often as much or more than the home is worth.

State legislators continue to find solutions for homeowners.

Last year, Connecticut Legislature considered options for helping homeowners to pay for foundation repairs, so they can stay in their homes.

Now there’s a partial solution, in the form of a captive insurance company: Connecticut Foundation Solutions Indemnity Company.

CFSIC will provide up to $175,000 for foundation replacement for single family homes and condominiums of up to 4 units.

Legislation currently under consideration would provide additional coverage for condo buildings with more than four units, with a cap of $43,750 for each unit over the first four.


Condo associations now eligible to apply for crumbling foundations funds

MAR 11, 2019 | 5:25 PM

The Connecticut Foundation Solutions Indemnity Company announced Monday that it will start working with condo associations to secure funds for the replacement or reimbursement of work done on their crumbling foundations.

Until Monday, funds from CFSIC were unavailable to condo associations as the captive insurance company worked to change legislation that prohibited condo buildings of more than four units from applying for funding.

Michael Maglaras, superintendent of CFSIC, which oversees the dispersing of funds to homeowners with failing foundations, said in a statement Monday that he felt it was time to start working with eligible condo units and planned unit developments.

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Latest News: March 11, 2019

CFSIC is licensed in the state of Connecticut as a captive insurer. It has been organized under Connecticut’s captive statutes, enabling it to serve a limited purpose, which is assisting with the crumbling foundations natural disaster. CFSIC is not a commercial insurance company. It does not sell insurance to the public or otherwise conduct its business for any other purpose except addressing the crumbling foundations issue. Learn more about what a captive is.


A captive insurer is a non-commercial, private company, established for a special purpose. In this case, CFSIC provides limited funding for foundation repair and replacement, where foundations have failed due to the presence of pyrrhotite, a mineral that causes concrete to break down prematurely.

According to its website, CFCIS gets its money from the Connecticut Bond Commission and a surcharge on homeowners’ insurance policies across the state.

The funds are limited, and, at this time, CFCIS will stop taking claims as of June 30, 2022.

The process of filing a claim can be time consuming and complex, especially when more than one owner of a residential structure shares the same foundation.

Three commercial insurers, Travelers, The Hartford, and Liberty Mutual have agreed to process claims for bad foundations only after CFCIS makes its payment to homeowners.

Unfortunately, CFCIS funding is limited, and the captive insurer may run out of money before paying all eligible claims.

For more information see these FAQs.

See the condos and PUDs announcement here.

Senator Blumenthal continues to seek Federal assistance for Connecticut homeowners with crumbling foundations.

See: CT senators seek funds to fix crumbling foundations
By Ana Radelat, CTMirror.org Published 2:54 pm EST, Thursday, February 7, 2019

Crumbling foundation condo owners plead for help

By: George Colli
Posted: Mar 08, 2019 07:06 PM EST
Updated: Mar 08, 2019 07:09 PM EST

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