Factor arranged building insurance

Doug31122005

I have just moved into a flat as part of a development of 262 flats. I have just received my factors bill which includes a quarterly charge of £467.84 for buildings insurance. This means I will pay £1871 a year and combined we will pay an annual premium of almost half a million pounds just for buildings insurance. I have asked the factor for a breakdown of this sum but as yet no reply

This seems very excessive to me. Am I just being naive or could we be being overcharged? Is there anything I can do?

lisyloo

Did you not investigate this before you moved in?

Do you know exactly what it's for, for example is it just for an insurance premium or does it include charges for other things like a contingency fund.

Whether you can change it will depend on the terms of your lease.
Often residents can set up their own management team but that does depend on people like yourself being willing to attend meetings, take minutes and get agreement with other residents.
Sometimes there simply aren't the people willing to do this work.

Have you spoken to other residents?
Surely they can't be happy about these bills either.

Doug31122005

I did check in advance. The home report says the monthly factor fee totals £150. Indeed flats in the same development are still quoting monthly factor fees of circa £100-150 per month - Not the £266 it appears to be.

I have queried this with the factor and asked for a breakdown of what is covered and where this money is going. They can post out a notice if what is covered but nothing about the financials as they do not "receive a hard copy of an invoice".

I am going to contact some of my fellow residents, but the ones I know at the moment are renters so don't care about this sort of thing. My big query is to find out if this sort of annual charge is normal as well as if it can be reduced.

*Scarlett

Are you tied into an agreement to have buildings insurance with the management company?

Could you get this cover independently? Some insurers (not all) will cover flats.

You would still usually have to pay fees for common areas but if you can insure your own flat more cheaply (and have adequate cover) could you put this to the management co.

Without having a breakdown of the actual insurance costs as opposed to other costs it's hard to know if what you are paying is unreasonable (but it does sound like a lot).

I would pursue this further with the management co. It's not good enough for them to say they they don't get a hard copy of an invoice. I would be astounded if any company would just pay out without receipt of an invoice - there must be bills for the insurance, maintainence contracts, etc.

Surely any agreement the factors co has would give a breakdown of these charges?

Go through the complaints procedure with the co concerned .

If you don't believe you are being treated fairly you could contact

http://financial-ombudsman.org.uk/

rs65

Are you sure it is quarterly? Is it not an annual charge which is paid in this quarter?

Even so, that's an expensive premium. Get the factor to provide copy policy docs.

Doug31122005

I did check if it is annual but they have told me via email it is the quarterly charge. The £467 is the quarterly charge for buildings insurance only. There was a further £200 covering the other charges for the building (grounds and lift maintenance etc).

I contacted the estate agent that prepared the home report which dramatically understates the factors fees as well as the solicitor who carried out the legal side on my behalf.

Next step I think is to approach neighbours to confirm what they pay.