January
How does the Insurance Act of 2015 affect leaseholders?
iInsure365 arrange building insurance for blocks of flats. We understand in detail the distinct requirements for these types of properties. We arrange flat block insurance for purpose-built and converted properties, owner-occupied blocks and rented flats.
Why is iInsure365 different from a managing agent?
iInsure365 make the business of insuring a block of flats as simple, straight forward and inexpensive as possible.
Block of flats insurance is traditionally arranged through third parties. With everyone involved possibly taking a part of the premium as commission. We are completely different and we only deal direct and don’t pay commission to managing agents.
iInsure365 will get the best possible terms they can offer. Work with a huge range of insurance companies to ensure they are always competitive. Insurance companies can often change their criteria when it comes to insuring blocks of flats. We are ideally placed to ensure that we can offer the best possible cover at the most reasonable and cheap cost.
Do iInsure365 deal with managing agents direct?
No, we have made it a point not to work with managing agents. We are open and transparent with all our fees and commissions and are happy to disclose any of these at any time. Many leaseholders aren’t aware that the managing agents are making commission. This involvement can lead to an increased premium. Landlords can often add to the premium in order to increase their commission on the policies. We do not.
What is the Insurance Act of 2015?
The Insurance Act of 2015 updated the law on disclosure and misrepresentation. It now requires insured parties to disclose every circumstance they know or should know that would affect an insurance premium. An insurer needs this information to decide whether to offer a premium at all and at what price. If the insured is in breach of the duty of fair representation the insurer can cancel the policy and keep the premium paid if the breach was deliberate.
How does the Insurance Act 2015 affect leaseholders?
Part II of the Act now creates a new duty of fair presentation encouraging active rather than passive engagement by insurers. They need to now tell the insured all that they need to know as well as clarifying if necessary the information disclosed.
Also, did you know that you can ask your managing agent for confirmation of what their commission is?
Summary
We have made it our number 1 priority to ensure that clients know what they are buying and know what the law is. It is important for people to understand that they may be overpaying for their building insurance cover. The Insurance racket has been going on long enough with property management in blocks of flats and it is now time for this to change.
December
Insurance – Do you know what you’re paying for?
How are landlords/Corporate Companies still ripping off lessees?
There was a recent case from a Tribunal regarding the Regis Group. Leaseholders now have a model example of how to fight excessive insurance costs via a Tribunal against the Regis Group.
Jeremy Peachy, a chartered surveyor, challenged the £13,000 insurance costs of a 30 flat site in Northampton. Regis Group/Pier Management owned the freehold.
The Tribunal found that the insurance costs were excessive. They ordered to reduce the bill down by at least two thirds to £4,364.00. The Tribunal made a Section 20C order barring the freeholder from putting any of his costs into the leaseholders account as well.
The Regis Group which owns over 30,000 freeholds argued that it bought insurance on a portfolio basis, not by individual properties. This is an argument used by many freeholders. The Tribunal made the following statements about the situation:
“It is the ability to buy bulk that enables them to earn commission of 15% on that portfolio as a whole for the return of work done.”
“The terms of the “block policy” were not so disadvantaged to justify a premium increase from £3,795.36 to £12,998.40 particularly when one of the virtues of a “block policy” for the tenant is that it carries a discount.
The Insurance Industry
It is not unusual for freeholders or managing agents to make a mark up of at least 15% on insurance.
Insurance commissions are a huge revenue earner for speculators in residential freeholds. Bumping up commissions when leaseholders are unaware as they are not part of the contract. This is also a practice known as padding the insurance. It basically means that freeholders will insure their properties and add a substantial amount to the premium via the broker.
Did you know that you are entitled under the Law to ask what commission the managing agent and/or freeholder earns? They have to disclose the full amounts of any money they receive. It is often not known or used. We find that most managing agents will try and state that they use the money for “claims” or to help to reduce your overall management costs. This should never be the case.
Summary
We do not pay commission to managing agents and are therefore more than happy to be transparent regarding any commission that we receive. Whilst we do receive money for providing the insurance itself we provide a completely transparent service. We are not beholden to any freeholders or managing agents. We provide a fantastic comprehensive cover at the best rate we can provide in the market. Not only in the first year but every year thereafter.
July
What Is Block of Flats Insurance, And Why Might You Need It?
When you own a house, buildings insurance is relatively straightforward and simple. Your premium covers the structure of the property, and any outbuildings such as sheds and garages against the costs of damage for insured reasons set out by your block of flats insurance company.
But what if you live in a block of flats? Do you insure just your portion, or should you also take into consideration the entire property?
Depending on your circumstances: whether you’re a landlord, freeholder or leaseholder, we could prove more beneficial to you than standard buildings insurance.
Here’s a look at it and why you might need it.
More cover than standard buildings insurance
Standard buildings insurance will cover your property should costs be incurred for repairing or rebuilding due to an sum insured event specified in your insurance policy. This typically includes damage caused by:
- flood
- fire
- burglary
- storms
- subsidence
- lightning strikes
- falling trees and branches
Most standard buildings insurance policies will also include damage to the building caused by leaks, faulty electrics, an electrical fire, burst water pipes. In most cases, buildings & block insurance will also cover outbuildings such as garden sheds, garden houses, pergolas, garages ,loss of rent and even greenhouses.
However…
If you live in a block of flats, standard buildings insurance may not cover areas such as:
- Communal areas, hallways, stairs, landings, gardens
- Shared contents such as communal equipment or furniture
- Property owner’s liability outside of your flat
Specialist covers all areas important to you and fellow residents in the block. It will give you the extra peace of mind you need and provide a more comprehensive cover than standard buildings insurance.
Who needs Block of Flats Insurance?
Just like standard buildings insurance, It isn’t a requirement by law. However, it can be particularly beneficial to:
- Freeholders who own the entire building then rent out individual flats within the building
- The property management company looking after the block of flats
- Flat leaseholders who club together and decide to pay for blocks of flats insurance between them
- Property developers and portfolio investors with a range of properties
What can Block of Flats Insurance cover?
- It include Damage to the building caused by insured events such as flood, fire, storms, subsidence, vandalism and theft or attempted theft
- Block Insurance cover trace and access costs of finding and repairing leaking pipes
- Communal areas such as outbuildings, hallways, lifts, stairs and gardens
- Property owner’s liability to insurance cover costs for claims made by someone who is injured in the block of flats insured
- Employer’s liability to cover anyone employed to maintain the communal areas
Ilnsure365, landlords insurance specialists, can provide competitive block of flats insurance cover to suit your needs, including discounts for multiple properties. Whether you need insurance for a converted block, a purpose built property, or an entire portfolio of properties, we’ll find the right cover for you. Request a call back for a member of the team to discuss our policies with you.
June
