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Section 2. Liability Insurance. The Association shall <br />naintain liability insurance for the protection of all Members <br />against claims arising out of injuries or damages sustained on or <br />about the Common Areas in an amount of at least One Million Dollars <br />($1,000,'000) per occurrence or such higher amount as the Board <br />deems appropriate. <br />Section 3. Fidelity Bond. The Association shall maintain <br />blanket fidelity bonds for all Association officers, employees or <br />agents who handle or are responsible for the funds of the Asso­ <br />ciation. The bonds shall be in an amount equal to all funds in <br />the possession of the Association at any time and in no event less <br />than three months' assessments for all Lots plus the Association's <br />reserve funds. "" <br />Section 4. Replacement or Repair of Property. In the event <br />of damage to or destruction of any property of the Association, <br />the Association shall repair or replace the same from the insurance <br />proceeds available. If such insurance proceeds are insufficient <br />to cover the costs of repair or replacement of the property damaged <br />or destroyed, the Association may JLe^ a Capital Assessment <br />(pursuant to Article VI, Section 6) against all Lot Owners to cover <br />the additional cost of repair or replacement not covered by the <br />insurance proceeds, in addition to any other Common Assessments <br />levied against the Lot Owners. <br />Section 5. Coverage. Loss Adjustment. The coverage and <br />provisions of all insurance obtained by the Association shall be <br />in conformity with FNMA requirements. <br />Section 6. Other Insurance; Annual Review of Policies. The <br />Association shall maintain any other insurance required by law or <br />by the FNMA or that it determines desirable and appropriate. All <br />insurance policies shall be reviewed at least annually by the Board <br />of Directors of the Association in order to ascertain whether the <br />coverage contained in the policies is sufficient. <br />ARTICLE V <br />MEMBERSHIP AND VOTING RIGHTS <br />Section 1. Membership Appurtenant to Ownership. Every Lot <br />is subject to assessment by the Association. Every Owner of a Lot <br />shall be a member of the Association. Membership shall be <br />appurtenant to and may not be separated from ownership of any Lot <br />which is subject to assessment. <br />Section 2. Classes of Voting Members. The Association shall <br />have two classes of voting members as follows; <br />- 8 -