Block of flats building insurance

Yogachap

I am a long lease holder in a block of flats where there is a right to manage company (RTM) who have appointed a block manager. The RTM recently and without consultation introduced a water leak policy which means that they will not allow leaseholders to make claims under the block building insurance. Instead, the RTM expect leaseholders to claim for water damage under their contents policies. Clearly contents policies cover moveable items and not ceramic floors, wall tiles and walls etc so it is unlikely that a claim would be successful. The RTM have also proclaimed that leaseholders have to cover trace and access costs to investigate leaks as they will not allow claims under the block insurance.

In order to deter leaseholders from contemplating a claim under the block insurance policy, the RTM, without consultation, renewed the insurance policy with a £5k excess whereas it was previously £100. I advised the RTM that this is unfair and they now refuse to communicate with me and I have made a complaint to the block management company.

I consider the above to be unacceptable as it puts leaseholders in a position where the block insurance policy is useless for claims under £5k. I have recently had a water leak in my bathroom from a shower valve and the repair cost is less than £5k so it looks like I will be unable to recover the loss.

Please could invite comments.

dacouch

Have there been a lot of escape of water claims?

FlameCloud

I used to live in a very large development in London where there were so many EOW claims the underwriters at the time offered a choice of no EOW cover or a 10K excess for them. The only option that they could find was with a £3k excess for it.

Aside from going through the complaints procedure with the block manager, I cannot see what else you can do.

I forgot this part-

The lease will likely compel the freeholder to insure the premises against insured risks, which will invariably be defined at the front as including EOW. So, fr the first part, they are likely in breach of this in refusing to allow EOW claims to go through. That said, if you have given them the right to manage the building and its insurances the only way you will able to change is to remove them from running the affairs of the company.

RTM can often be difficult if the person arranging the insurance does not know what they are doing, in either arranging the cover or setting the sums insured. The worst case I've dealt with for a RTM was a flood claim to 5 basement flats which totalled about £250,000. The issue was that the management committee had only adequately insured the building to around 50%, meaning each leaseholder needed to find around £25,000 to repair damage they thought they had cover for.