Fixtures and fittings in leasehold flat

d00fus

Hi,

I own a leasehold flat above a commercial premises, and I'm struggling to get to the bottom of who is responsible for insuring the fixtures and fittings of my flat, even after talking to the Leasehold Advisory Service (LAS) and reviewing the leasehold agreement and policy wording, and was wondering if anyone has some advice.

The freeholder/landlord owns the business below, and has building insurance for the whole building. The flat was converted by the landlord and has the same fixtures and fittings as then, I haven't modified it. The policy wording indicates it covers "landlord's fixtures and fittings", but doesn't itemise either inclusions or exclusions, and covers reinstatement or repair to its "condition when new". The lease agreement says the landlord must keep insured the "full value of the Demised Premises against loss or damage requiring the rebuilding, repairing and reinstating of the Demised Premises and the Property" and defines the Demised Premises as "that as the flat on the second and third floors shown edged red on the Plan" and the fitted bathrooms and kitchen (which are what I'm concerned about) are depicted on that plan inside the red edge. The fixtures would seem to be covered from that description but even the LAS wasn't really sure.

From what I can tell no contents policies seem to cover this situation. I could get building insurance, but then the building itself is double insured. I tried getting quotes for a reinstatement value of just the fixtures and they come through more expensive than the building as a whole, perhaps because a very low insured value is making the insurer's system flag it as a risk? I've called a couple of brokers, and they both seemed confused about the situation and couldn't offer cover. I'm quite astonished as surely there must be thousands of leasehold flats in the UK in this situation? If anyone has any advice that would be great.

Thanks!

BernieW

What comprises the "demised premises" will be what is within "the red line" on the plan - but will be more extensively described elsewhere in the lease. That will vary from lease to lease, so it's hard to be more precise without reading your specific lease.
Generally, you will be responsible for the maintenance of all fixtures and fittings which serve your flat only; e.g. your loo, your bath, your kitchen sink. You will not be responsible for maintenance of communal fixtures and fittings; e.g. the main soil pipe into which your loo discharges. Repairs and maintenance of communal stuff would normally be the responsibility of the landlord, often via their managing agent.
As a leaseholder, you need to insure your "contents". That would include all your personal stuff and everything which would fall out if we picked up the flat and shook it vigorously - plus stuff which is fixed down and wouldn't fall out, such as the carpets.
So in short, the landlord's building insurance policy should cover the fixtures and fittings.
I'm happy to read your lease and the buildings insurance policy if you send them over. Bernie Wales 

d00fus

Hi Bernie, that would be amazing, thank you very much! I'll DM it to you

BernieW

Thanks sending the documents via DM, James.
Clause 5(1) of the Lease requires the landlord to maintain and repair the main fabric of the building and the communal pipes etc. No problem there.
Clause 5(4) of the Lease requires the landlord to insure the Demised Premises (your flat) and the Property (the building within which your flat is situated). Therefore it is the landlord's responsibility to insure fixtures and fittings, alongside everything else which is part of the building; i.e. everything except contents.
Looking at the insurance schedule all seems standard - provided the insured is your landlord, the person who owns the freehold title and to whom you pay ground rent. I can check if you send me the latest ground rent demand.
If you look at page 6 of the insurance policy wording > Property Insured > Buildings > you'll see it says "including landlord's fixtures and fittings" ... which includes the baths, loo, etc.
All therefore seems ok to me.
Bernie Wales

BernieW

Further to your subsequent DM, James ...
The fixtures and fittings are the landlord's responsibility - so from an insurance perspective, they are the landlord's fixtures and fittings. In any event, at the end of the term - at the end of the lease - those fixtures and fittings will be left in the flat, so for all purposes they are the landlord's fixtures and fittings.
On the fitted wardrobe point - I am guessing it is "fitted" by means of some screws attaching it to the walls and the ceiling. The lease describes the "demised premises" as including "one-half in width severed vertically of all walls separating the demised premises from any other part of the building - so a few screws into your part of the walls is fine. The demised premises also includes "all the floors and ceilings and joists within the demised premises" - so a few screws into your ceiling and your floorboards are fine too.
Don't worry so much - but you are sensible to have checked.
Bernie Wales

Mike_Norwich

Hi,

I'm not sure if I should start a new thread for this. My situation is in some ways similar but in some ways different. I live in a city centre development. We each own our properties leasehold and the freehold is owned by the residents company in which we are all shareholders.

Under the terms of the lease the landlord (the residents company) is responsible for insuring the buildings and we are each responsible for the interior of our properties. The difference is that the lease makes it clear that the leaseholders are responsible for all the fixtures and fittings, including plasterwork, radiators and doors & windows. The broker used by the residents company has confirmed that the collective policy does not cover these items and has told me that even if the residents company wished to insure these items (which it doesn't) it is not legally permitted to do so because it has no financial interest in them.

No insurance company is willing to extend their contents policy to include fixtures and fittings and I have been told that I am not allowed to take out an additional buildings policy because I do not own the freehold.

Are my fixtures and fittings really uninsurable?

Mike

Sandtree

The contract has created a financial interest in them if you have a liability for them. This fairly routinely covered by Content's insurance. For example our policy with M&S (Aviva) states:

We will provide cover up to the limit shown on your Schedule if you are legally responsible as a tenant for: 
a) loss of or damage to the home and fixtures and fittings and contents belonging to the landlord by any of the causes listed under Contents in the home section 1 to 10. 
b) accidental damag

The clause references earlier section of perils which are all your standard fire, flood, theft etc

eddddy

Mike_Norwich said:

Hi,

I'm not sure if I should start a new thread for this. My situation is in some ways similar but in some ways different. I live in a city centre development. We each own our properties leasehold and the freehold is owned by the residents company in which we are all shareholders.

Under the terms of the lease the landlord (the residents company) is responsible for insuring the buildings and we are each responsible for the interior of our properties. The difference is that the lease makes it clear that the leaseholders are responsible for all the fixtures and fittings, including plasterwork, radiators and doors & windows. The broker used by the residents company has confirmed that the collective policy does not cover these items and has told me that even if the residents company wished to insure these items (which it doesn't) it is not legally permitted to do so because it has no financial interest in them.

No insurance company is willing to extend their contents policy to include fixtures and fittings and I have been told that I am not allowed to take out an additional buildings policy because I do not own the freehold.

Are my fixtures and fittings really uninsurable?

Mike

When the flat was first leased it would have included windows, plasterwork, a kitchen (perhaps a basic one), a bathroom (perhaps a basic one) - and you will be expected to leave these (or similar quality ones) behind when the lease ends.

The freeholder should include the value of those original fixtures and fittings in their building insurance.

However, if you replace a basic kitchen with a £20,000 one, replace a basic bathroom with a whirlpool bath, replace standard light fittings with an expensive ones, put up expensive wallpaper etc - the freeholder's policy might not cover those. If nothing else, the freeholder would not add £30k+ to their sum insured.

However, you can take out "Tenants Improvement Insurance" specifically to cover those improvements. You can google for more info. I've no experience of that kind of insurance - or most importantly, how much hassle is involved in making a claim. (e.g. The suggestion seems to be that if your luxury fitted kitchen is damaged, you claim for the cost of a basic kitchen from the freeholder's insurer, and the rest from the Tenants Improvement Insurer - which sounds like it could get messy.)

Mike_Norwich

Thanks for responding. When I renewed my contents insurance I spoke with my broker who told me that this type of cover was not appropriate. My understanding from what she said was that landlords fixtures and fittings covered the situation where they are owned by the landlord but I am responsible for the upkeep. The issue here is that I don't think the landlord owns the fixtures and fittings, certainly not all of them. For example I have just replaced a bathroom and put in a new wooden floor. Are you saying that in law the landlord owns these items even though I bought and paid for them? Does the landlord own my washing machine?

Mike_Norwich

Thanks,

I'll try attacking it from that angle.

Mike

Sandtree

Mike_Norwich said:

 Are you saying that in law the landlord owns these items even though I bought and paid for them? 

To put it another way, when you bought the lease did you expect the previous leaseholder to remove the bathroom and kitchen etc before you moving in? Or did you expect them all to still be there when you moved in despite the fact the previous leaseholder may have replaced them all themselves? If the place had a fantastic new kitchen full of built in Miele appliance would you have expected to pay the previous leaseholder more for it than if the kitchen was falling apart and the appliances were all 20 years old?