Buildings insurance

Homeowner1905

Hi all

Hoping someone can help me here.

I a property recently, which is a Victorian house converted into two flats. I am the freeholder of the building and the other flat is also owned but on leasehold basis.

I had to arrange full buildings insurance for the whole building to allow the mortgage to go through.

The flat owner downstairs I explained this to and said as per terms of lease we need one policy it is not allowed to insure both flats separately.

They seemed happy to join and share premiums. However 3 months later and several attempts later still not getting any joy from them.

I’m stressed because freeholder is responsible for building and at moment there is a policy on their flat and one on the whole building.

How do I enforce cancelling theirs and joining my policy.

I have explained the importance of it yet keep dodging the issue.

Anyone in the know I would greatly appreciate factual information on what I can do.

eddddy

Homeowner1905 wrote: »

Anyone in the know I would greatly appreciate factual information on what I can do.

Broadly, there are two ways you can deal with this - informally or formally.

1) Informally means that you're both sensible, there's no arguments, and the leaseholder 'volunteers' to pay you their share of the insurance premium, etc.

2) Formally means that you follow the processes defined by law, and ultimately the leaseholder is 'forced' to pay you. The formal legal process is as follows:

• If the lease says you (as freeholder) must insure the whole building, you must go ahead and do that.

• You give the downstairs leaseholder a 'Service Charge Demand' (a bill) for their share of the insurance premium. (The 'Service Charge Demand' must contain certain information to make it legal.)

• Most leases allow you to demand Service Charges in advance, but some only allow you to demand them in arrears.

• If the leaseholder doesn't pay a correctly demanded service charge, the lease probably allows you to:

• Send reminder letters (and charge the leaseholder an 'Administration Fee' for each reminder letter sent).

• Instruct a solicitor (and charge the leaseholder for the solicitor's fees.)

• Make a court claim for unpaid charges (i.e. Insurance Charge, Administration fees, solicitor's fees)

• Ultimately, if Service Charges remain unpaid, you can get a court order to forfeit the lease. (i.e. you repossess the flat)

There can be lots of responsibilities associated with being a freeholder, and there's lots of legislation that you have to adhere to. You probably need to get up to speed on it.