Building Insurance on Leasehold

RichCH

I'm a first time buyer, and we're going to be finding out within the next week our date for exchanging contracts. But something has come up with the buildings insurance that I am confused by and I am not sure what cover I need to get myself.

So to give an overview of the property, the building comprises of two Georgian semis, which we are buying the top floor of one of them. I have been told that the service charge covers part of the buildings insurance. It apparently covers the roof, the foundations and the common parts. I've been told by my solicitor that I need to arrange cover for the building on the other bits. But what exactly am I meant to cover? The walls? The windows?

Many thanks

Rich

cattie

I've never heard of a buildings insurance that doesn't cover all of the exterior & common parts, so wonder if your solicitor just hasn't explained things properly?

As I've mentioned it is normal for the buildings insurance to cover all of the exterior etc and for the leaseholder to be responsible for covering the interior parts of the flat.

It is usually the freeholder or managing agent who arranges the buildings insurance for the whole block and each leaseholder then has responsibility for arranging their own contents insurance.

Is there somebody living in the flat who could explain to you how the insurance aspect of the property has worked whilst they have lived there ?

olly300

You are suppose to cover the interior walls, ceilings and floors of your flat plus the kitchen units and bathroom sanitary ware. This is normally covered by block buildings insurance as you pay for it in your service charge. However some freeholders choose not to do so.

I would find out the underwriter of the buildings insurance, find a broker and tell them who this underwriter is. They then may be able to arrange a policy for you covering the part of the buildings you need plus contents insurance.

Most insurers don't cover buildings insurance for individual flats though Axa and Direct Line (UK Insurance) do.

BTW I'm in the same situation which is why I can answer your question

RichCH

Thanks so much. It does seem odd to me, as when I've been on things like confused.com and comparethemarket, it obviously only gives you an option to do your section of the flat, no mention of roofs or insuring separate parts. I think I'm going to have to get a broker involved so they can get me a quote.

propertyman

RichCH wrote: »

I think I'm going to have to get a broker involved so they can get me a quote.

The earlier reference to block insurance is likely incorrect.

In older leases it was quite common for the block insurance to be restricted to the roof common parts foundations etc, and the individual flats DO insure their walls inside and out, and also the structure to the floor/ceiling.

Dont forget to inculdes pipes and services and fixtures and fittings as well as alternative accomdation and loss of rent, if rented out, and the uplift in rebuilding costs over the anticipated time of the rebuild, as well as your share of professional fees consents and site clearance.

As you probably see the Insurer will want a figure to insure, which has nowt to do with the vlaue of the property.