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Joint freeholder doesn't want joint insurance

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Joint freeholder doesn't want joint insurance

edited 10 January 2020 at 6:52AM in House Buying, Renting & Selling
31 replies 1.4K views
MarlaMMarlaM Forumite
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edited 10 January 2020 at 6:52AM in House Buying, Renting & Selling
Hi there,

I'm new here, but I have tried to search for any answers to this but I can't quite find the same thing so I hope you may have some advice for me please, thank you.

I recently bought a flat in converted house that contains two flats. We are both co-freeholders. The other freeholder and I chatted about getting joint insurance but the quotes came back quite expensive, upwards of £800. The co-freeholder said this was too expensive (I agree, but also see the need for it) so they refuse to do this option and say they simply cannot afford that. There is nothing in the lease that says we must have a joint policy, only that it should be insured - whilst this is frustrating, I can't enforce it.

Obviously I am worried about the many issues separate policies could raise. This is probably a silly question, but is there a loop hole in us getting a policy with the same provider maybe?

Has anyone else got experience with similar? What did you do? I just want to cover my flat as well as I can in the circumstances.

Thanks in advance, M
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Replies

  • csgohan4csgohan4 Forumite
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    I think you should also consider being worried about future repair costs,


    If they can't afford £400 for split insurance, what are the chances they will share costs for a leaking roof or maintenance? Worrying indeed
    "It is prudent when shopping for something important, not to limit yourself to Pound land/Estate Agents"

    G_M/ PIxie RIP
  • eddddyeddddy Forumite
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    MarlaM wrote: »
    There is nothing in the lease that says we must have a joint policy, only that it should be insured - whilst this is frustrating, I can't enforce it.

    According to the lease, who has to insure the building?

    If the lease says that the freeholder must insure, then as joint freeholders, you have to jointly arrange insurance.


    So what does the other joint freeholder want to do about buildings insurance?
  • AdrianCAdrianC Forumite
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    It's one thing looking at the £400/ea cost of a joint policy, but how much would 2 x separate policies be? In other words, what's the actual saving that they're making? That's how much value they place on the potential hassle in a major claim...
  • edited 10 January 2020 at 10:37AM
    G_MG_M Forumite
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    edited 10 January 2020 at 10:37AM
    What is the exact wording in the leases regarding insurance?

    Have you and the other joint freeholder fully understood, and discussed, the issues around insuring separately? eg

    The property burns down.
    You claim on your insurance for your flat.
    He claims on his insurance for his flat.
    The 2 insurers start arguing about the overall cost to rebuild.
    They disagree on their respective shares of liability eg which one pays to demolish and remove the rubble, or which architect, at what price, to employ for the re-build.

    After 6 months of arguing (you being homeless all this time), they finally release some funds, but at different amounts, and in diffenent frequencies, which means the builders work in fits and starts. The whole process takes years..........


    On topof that there is the risk that one of you has 'under insured'. Or one of the insurers believes the other is under-insured.
    ** If I include a blue link in my post, click and read it before posting a follow-up question. The answer may be in the link! **
  • MarlaMMarlaM Forumite
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    Hi, sorry, I didn't get notifications that anyone had replied, so sorry for the delay.

    I don't know the wording off by heart so I will come back with it shortly. But I do know it's very vague because I consulted my solicitor first and she said there is nothing that explicitly says we have to jointly insure, just that we must have insurance.

    It's so frustrating because the co-freeholders are also aware that it cause huge issues but would rather pay less now and "cross that bridge when it comes to it" if the place burns down!

    One thing we were going to both make sure to get is unlimited rebuild cover - I'm not sure if anyone could recommend any other things we could put in place to protect as best we can in the situation we have?

    Many thanks
  • edited 15 January 2020 at 10:05AM
    MarlaMMarlaM Forumite
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    edited 15 January 2020 at 10:05AM
    @AdrianC

    Separate insurance would save us £300 each (It would be around £100) - and that is what they want to do. I don't know their situation with money but they are point blank saying "no way" to it, so it seems I have to lump it.

    They have very much a 'my way or the highway' attitude as they have been in the building for many many years.
  • eddddyeddddy Forumite
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    MarlaM wrote: »
    I don't know the wording off by heart so I will come back with it shortly. But I do know it's very vague because I consulted my solicitor first and she said there is nothing that explicitly says we have to jointly insure, just that we must have insurance.

    I suspect that you may have asked the solicitor the wrong question, and therefore got an unhelpful answer.

    The key question is, according to the lease, who has to insure the building?
    • Does the lease say the leaseholders have to each insure their own flat?
    • Does the lease say that the freeholder has to insure the building?

    I would be 99% sure that the lease is clear on this.

    If the lease wasn't clear on this, your solicitor should have been waving a big red flag before you purchased, and your solicitor would have told your mortgage lender, and you would have been refused a mortgage.
  • MarlaMMarlaM Forumite
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    eddddy wrote: »
    I suspect that you may have asked the solicitor the wrong question, and therefore got an unhelpful answer.

    The key question is, according to the lease, who has to insure the building?
    • Does the lease say the leaseholders have to each insure their own flat?
    • Does the lease say that the freeholder has to insure the building?

    I would be 99% sure that the lease is clear on this.

    If the lease wasn't clear on this, your solicitor should have been waving a big red flag before you purchased, and your solicitor would have told your mortgage lender, and you would have been refused a mortgage.

    (Only just grasped how you are doing the quoting! haha)

    Ahh quite possibly. I suppose I presumed she would know what I meant. Ok thank you, I will look back at the wording when I get home from work.

    Thank you for your help, have a good day.
  • eddddyeddddy Forumite
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    MarlaM wrote: »
    @eddddy

    Ahh quite possibly. I suppose I presumed she would know what I meant. Ok thank you, I will look back at the wording when I get home from work.

    Thank you for your help, have a good day.


    I'll take a guess at what has happened... but my guess may be wrong.
    • The lease says the freeholder is responsible for insuring the entire building (i.e. one policy for the whole building) That's usually the case.

      Therefore, in this case, the joint freeholders (you and the neighbour) are responsible for arranging the policy.
    • You asked the solictor something like "Should the buildings insurance be in joint names?"

      The solicitor answered something like "The lease doesn't specify that insurance must be in joint names."

    i.e. The full answer is:

    The joint freeholders are responsible for arranging a single insurance policy for the whole building - but it doesn't matter if the policy is in your name or your neighbour's name or your joint names.

    But like I say, you'd need to read the lease and the letter from your solicitor to confirm this. My guess may be wrong.
  • ethankethank Forumite
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    I had a flat with an absent landlord before. Every tenant insured their own buildings and contents and if there are any issues the insurers can discuss within themselves. Not a problem.
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