Can letting agents enforce insurance purchase?

thequant

DO NOT TAKE OUT ANY INSURANCE AT ALL! I use to work in this sector and most insurance contracts for BTL are not worth the paper they are written on. The success rate of claiming on a BTL product is less than 2% and most of thos had to pursue their claims vigoursly. BTL insurance is going to be the next financial scandal to break when the PPI thing dies down.

G_M

FireWyrm wrote: »

You cant take out buildings insurance. You dont own the building and neither do you have any financial interest in it. Point this out the EA. You cannot physically comply with the requirement of the contract to supply buildings insurance and even if you could, why doesnt the LL have his own? We had the exact same problem with a damaged bath due to a pure accident. I thought (wrongly) that my own contents cover would suffice, but since baths are a fixture, they are part of the building and therefore, not insurable by anyone but the owner. You cannot insure what you dont own and the LA should know this. Get it all in writing up front.

Whilst I agree with the points in the post, I see littly value in pointing it out to the EA.
a) the EA is clearly one of those less than professional ones (letting agents need no qualifications - anyone can set up as one)
b) they clearly have their misguided policy - they'll just refuse to grant the tenancy

So I stand ny my original advice. Get the tenancy you want, then leave the agent to bang their head against a wall if they choose to try to enforce insurance on you.

FireWyrm

G_M wrote: »

Whilst I agree with the points in the post, I see littly value in pointing it out to the EA.

Because it might have been an oversight? The EA cannot argue with the law and pointing it out cannot be wrong in that case.

G_M wrote: »

a) the EA is clearly one of those less than professional ones (letting agents need no qualifications - anyone can set up as one)

Whilst this may well be true, it's a bit of a value judgement dont you think? This could all be a total storm in a teacup, the clause is unenforceable anyway since it's not possible to comply with it. No judge would enforce that aspect of the contract. The OP is clearly in the right and the EA is clearly wrong. Who knows who put that bit in the contract, it could have been the office bike and typist for all we know, but if the EA continues to issue them without challenge, it will never get rectified.

G_M wrote: »

b) they clearly have their misguided policy - they'll just refuse to grant the tenancy

Another value judgement. Who knows, the EA might say "Whoops, gosh, that was silly wasnt it, we'll send you an ammended one asap". Either way, the OP shouldnt want to do business with a company that is shady if they wont change it, and if they will, then job done, no misrepresentation and the OP has the high-ground because it's all sorted and in writing.

G_M wrote: »

So I stand ny my original advice. Get the tenancy you want, then leave the agent to bang their head against a wall if they choose to try to enforce insurance on you.

Perhaps....your method is certainly feasable, but if it were me, I wouldnt want to do business with a company that wont change this clause...what else is hidden in there....hearts blood of your first born? I would want to know NOW, not later when I'm half way through a tenancy and being sued for a clause I could not possibly comply with, or worse, accused of misbehaviour which leaves a bitter taste in everyone's mouth regardless of the legality or not thereof.

G_M

I don't deny these are value judgements! It's my advice on how to respond in a practical way to the problem described.

You may well be right Firewyrm (it would boost my respect for letting agents!) and they may apologise/delete the clause/change their policy but my..... judgement..... is that it is more likely they will decline to grant the tenancy.

Whether the OP wants a tenancy with such an agent is again a judgement call, but if they do, then they have to either raise the issue and gamble the agent responds as you suggest, or not raise the issue till after the tenancy is granted......

princeofpounds

I agree with G_M's approach.

The poster above referring to Windsor and District Housing Association Ltd. v Hewitt, is I think reading too much into this case. Basically, a woman claimed she needed a 2 bed to get a tenancy granted by the housing association, as she required care. Then it turned out she didn't need care after all.

The approach suggested above about buying and cancelling the insurance is not a deception. The insurance would be bought at the time the contract is signed - there is no deception. The later cancellation of the insurance would have no relevance, as the term is clearly unenforceable and so there could be no breach of contract through it's absence.

That's on top of the practical issue that tenants generally cannot buy insurance for a house owned by a third-party landlord, so any insurance would be totally useless anyway. Judges are not stupid and would realise an absurdity when they saw one.

An unfair term is legal, enforceable and binding until a court overrules it or parliament deletes it

Given that only a court can decide what is legal, enforceable or binding this statement simply isn't true. It can be presumed legal, enforceable and binding, but it can also be presumed not to be. As the saying goes... see you in court.

prudryden

Prince - well stated. I agree and did say that the case presented was not the same but I should have said similar in that Ground 17 was used.
Let's forget about house insurance as I don't think that was what was meant - £2,500 would only cover a toy house. I think what was meant was contents insurance. Now normally this is only recommended not required to tenants. However, in this case the LL wanted to make that part of the contract in order to rent to whoever was interested. I think that is fair enough.
What was recommended was that the tenant take out insurance, show it to the LL as proof that he acquired the insurance, and then cancel it. That is tricking the LL into giving him the contract rather than to someone else who may agree to the request. Should something happen and the need arises for the LL to pay for something which the tenants insurance should have covered, then I expect the LL could POSSIBLY issue a Section 8, Ground 17 with two weeks notice which then goes to court.
I personally think it is better for the tenant to look elsewhere than deceive his LL and I think the recommendation to deceive was in error.
Many contracts have unfair terms which we have to put up with. I disagree with you that an unfair term is illegal and not enforceable. It is binding and enforceable unless it goes to court and the court rules that it is not binding and enforceable. Mortgage companies and banks have many terms which we find unfair, but they still have them.

All I said initially was "Be wary of acquiring a contract by deception." Then, all of a sudden, we had what's his face spouting about police and criminality and the LL trying to enforce an unfair contract. If one thinks the contract is unfair, don't sign it. It happens every day a million times probably with contracts.

G_M

Oh for goodness sake! For someone who says

Check out contract law before you mislead people with moronic legal statements. You have a weird sense of knowledge of what is legal and unfair.

you show remarkably little legal understanding.

I disagree with you that an unfair term is illegal and not enforceable.

that's the point. 'illegality' is a term used in criminal law - not contract law. Noone has suggested criminality except you: "acquiring a contract by deception." ie fraud. Hence my reference to police.
As for your repeated claim that

It is binding and enforceable unless it goes to court and the court rules that it is not binding and enforceable.

it is only enforceable if it is of a nature that a court would enforce! Since this is the type of clause that a court would NOT enforce, it is not enforceable. It is likewise only binding if, in the event of it being breached, a court would enforce it. Again, a court wouldn't, hence it is not binding.
This, like all legal interpretation that has not yet been through the courts, is of course, opinion. Your opinion may differ from mine, just as lawyers frequently interpret law differently/have different opinions - which is why we have courts to make rulings.


But looking at the practicality of the situation, rather than the law, the OP wants the property. There is frequently competition for desirable properties. The OP is (so far as we know) a suitable tenant. He is being offered a contract with an unfair term within it but does not want to walk away. So I offer a practical solution.

If the term he disliked was a fair one, which could be enforced, (eg a high rent) then I would advise him not to sign!
'what's his face'

Callie22

We had a similar problem - basically, it appeared to be a ruse to bully us into getting special 'tenant's insurace' through Homelet (no doubt there was a nice bung in it for the LA). According to the salesperson from Homelet, they are the 'only' company in the UK providing special tenant's contents insurance, and we 'had' to buy through them at £10 a month.

I wasn't having any of this - we have contents insurance, and I'm not showing the LA the documents because I don't want to give them that kind of information. They have enough information about me and I'm not complying with anything that isn't legally required. Basically we ignored them and they've stopped asking us, after a few bleating phone calls where they moaned that 'it's in the contract ...'