Is home insurance included in the service charge for leasehold flats?

mickael28

Hello,

I read in the past that the freeholder of a block of flats would be responsible for the maintenance and insurance of the building, and I thought that this was what the service charge was covering.

I just wanted to confirm if that understanding is correct as we've now applied for a mortgage in principle and there they say:

"You will need to make sure the property is insured before you enter into a commitment to buy. We can arrange property insurance and also have other property and personal insurance services available."

So I was wondering, do leaseholders need to do anything regarding insurance or there's nothing that they need to do if that's already covered when you buy the flat?

Many thanks...

G_M

mickael28 wrote: »

Hello,

So I was wondering, do leaseholders need to do anything regarding insurance ...
Many thanks...

Yes.

1) Read the lease. Insurance may be the freeholder's responsibility. Only the lease will tell you
2) Check it's done. just because the lease says the freeholder must insure does not mean the freeholder does insure.

katejo

G_M wrote: »

Yes.

1) Read the lease. Insurance may be the freeholder's responsibility. Only the lease will tell you
2) Check it's done. just because the lease says the freeholder must insure does not mean the freeholder does insure.

My freeholder was extremely uncooperative re. Building insurance . He refused point blank to accept that I needed any proof of insurance .

mickael28

G_M wrote: »

Yes.

1) Read the lease. Insurance may be the freeholder's responsibility. Only the lease will tell you
2) Check it's done. just because the lease says the freeholder must insure does not mean the freeholder does insure.

Ah, thank you!! I didn't know that information needs to be specified in the lease...

How could you check it's done if they say it's done on the lease but then they don't actually do it?

(and thinking about it, if you are paying the service charge to them and then they don't do it, wouldn't you be covered by the lease saying the building was insured and by you having paid all your service charges?)

trulys

Your legal adviser will ensure that adequate buildings insurance is in place when they raise their leasehold enquiries. A copy of the current policy schedule should also be provided.

In most cases the insurance premium is added to the service charge, but on rare occasions it is by way of an separate charge to the leaseholder.

neverdespairgirl

In almost all cases, insurance is the freeholder's responsibility.

In all cases, however, you should check that the responsbility has been fulfilled.

abankerbutnotafatcat

Firstly, remember that this is just buildings insurance, you need to obtain contents yourself.

Secondly, you should be provided with historic service charge bills during conveyancing and the breakdown will list insurance if it's included. Alternatively, the vendor or freeholder should be able to provide you with a copy of last year's invoice which you should be able to use as proof.

zzzLazyDaisy

The letter that you have received from your prospective lender is a standard letter which does not differentiate between leasehold and freehold, but merely reminds you that it is your responsibility to make sure that buildings insurance is in place.

In leasehold flats (but not normally houses) the buildings insurance is normally included in the monthly maintenance charge you pay. The rights and obligations will be set out in the lease, and confirmation of the building insurance should be provided by the Lessor/management company. As others have said, your conveyancing solicitor will check all this during the conveyancing process.

Werdnal

How can you check it is done? Ask for a copy of the certificate and/or policy! You are paying for it, you have a right to know what you are paying for!

My freeholder sends a copy to all leaseholders on renewal every year.

You should also receive a breakdown of what the actual service charge covers.

hazyjo

Remember to get your own contents insurance.

Jx

propertyman

katejo wrote: »

My freeholder was extremely uncooperative re. Building insurance . He refused point blank to accept that I needed any proof of insurance .

Dear Freeholder

Address of flat

Under section 30a of the Landlord and Tenant Act 1985 as amended by the Landlord and Tenant Act 1987, attached, I am writing to formally request under Sch 3 a written summary of the insurance cover including
(a)the insured amount or amounts under any relevant policy, and(b)the name of the insurer under any such policy, and(c)the risks in respect of which the dwelling or (as the case may be) the building containing it is insured under any such policy.

You must supply this within one month of this letter.

On receipt I will then my right for full copy if the policy under sch2 ,3.

http://www.legislation.gov.uk/ukpga/1987/31/schedule/3

PLEASE NOTE THAT FAILURE TO PROVIDE THIS INFORMATION IS A CRIMINAL OFFENCE.


Good luck