freeholder insurance costs?

CR2

me again, freeholder has billed us £240 for each flat, when questioned his response was:

According to our record you have been sent an invoice for this amount.
We pay one premium for all our properties, not individual amounts.
Regarding the insurance you deem excessive at £1900, we would advise you this is a very keen and low premium at approximately £239.40 for each flat. Some years ago the premium was more than double this figure and we worked hard and were successful in obtaining a substantial reduction on this particular property. It is not therefore possible for us to obtain a better quote than the existing one.

what's the course of action for this?

sooz

Ask what their kickback is on their block policy from their broker

Pay up, so you are insured.

Then form a residents association, & go down the RTM route.

Look at https://www.lease-advice.org for more information

HappyMJ

CR2 wrote: »

me again, freeholder has billed us £240 for each flat, when questioned his response was:

According to our record you have been sent an invoice for this amount.
We pay one premium for all our properties, not individual amounts.
Regarding the insurance you deem excessive at £1900, we would advise you this is a very keen and low premium at approximately £239.40 for each flat. Some years ago the premium was more than double this figure and we worked hard and were successful in obtaining a substantial reduction on this particular property. It is not therefore possible for us to obtain a better quote than the existing one.

what's the course of action for this?

but...is it excessive? What quotes have you got that are better than £1,900 per year? Is there an excess to pay on the policy? You could ask that an excess applies so the premium is reduced but then you will have to have a fund set aside to pay the excess in the event of a claim.

G_M

Let's see:

* you own a flat in a building
* it is sensible to insure the building in case it burns down and you lose your home
* you have a lease
* a legal requirement in the leae is for the freeholder to arrange insurance, and the leaseholder's to share the cost
* the freeholder has insured the building and billed you as per the lease.

CR2 wrote: »

what's the course of action for this?

Pay the bill?

Alternatives :
* shop around yourself to see if you can find (significantly) cheaper insurance for the whole building on a like-for-like basis, then present this to the freeholder
* take over the responsibility for insurance, maintenance etc from the freeholder (as per sooz's suggestion).

dacouch

That's not a bad price, I assume there are 8 flats so a total sum insured of circa £200k each so £1.6m in total.

The going rate for standard construction and no claims etc and wooden floors is circa 0.14% so when you add in tax it would be about £1900.

CR2

sorry didn't explain myself properly, i have no real issue with this apart from for 2 years he was charging us £450 a year for each flat, until our residents association pointed out we found quotes for £1k for the year and then he reluctantly "found" a cheaper quote, but over the last few years it's been going up disproportionately in our eyes.

i understand we're entitled to see the breakdown, but what do we do if there is no proper breakdown from his broker?

artbaron

Ask him what he meant by "...we worked hard and were successful in obtaining a substantial reduction..." Does that mean he spent 5 minutes on a website after being rumbled for ripping off his tenants? I really don't like people who talk to you as if you're an idiot.

Of course the insurance amount will vary dependant on a number of factors but £450 per flat is crazy regardless. Maybe premiums are also substantially more for multiple ownership but I pay barely more than a quarter of that for a similar cover, and that includes six figure contents.

propertyman

No .........! :(if you are as you say in the other thread an RTM, it insures , not the Freeholder.

Commonhold and Leasehold Reform Act 2002

96 Management functions under leases
(1)This section and section 97 apply in relation to management functions relating to the whole or any part of the premises.
(2)Management functions which a person who is landlord under a lease of the whole or any part of the premises has under the lease are instead functions of the RTM company.
(3)And where a person is party to a lease of the whole or any part of the premises otherwise than as landlord or tenant, management functions of his under the lease are also instead functions of the RTM company.
(4)Accordingly, any provisions of the lease making provision about the relationship of—
(a)a person who is landlord under the lease, and
(b)a person who is party to the lease otherwise than as landlord or tenant,
in relation to such functions do not have effect.
(5)“Management functions” are functions with respect to services, repairs, maintenance, improvements, insurance and management.
(6)But this section does not apply in relation to—
(a)functions with respect to a matter concerning only a part of the premises consisting of a flat or other unit not held under a lease by a qualifying tenant, or
(b)functions relating to re-entry or forfeiture.
(7)An order amending subsection (5) or (6) may be made by the appropriate national authority.


Given that there is huge hole in your roof and the insurer will not pay for it, you might have problem insuring.