Buildings Insurance - Shared freehold

tek290

We have recently exchanged on a share of freehold flat and the other joint freeholder are an older couple upstairs who are apparently very nice and have always just let my seller deal with all the freehold admin which is fair enough and I don't mind taking on that role once I've moved in. The estate agent just emailed me to say the seller is having issues transferring the current policy into my name and wanted to share my details so we can discuss directly, which is fine. The leasehold for my ground floor flat states that it is the responsibility of the persons owning the freehold to insure the building and so all good there, one policy for both us and the couple upstairs.

 

The current buildings insurance runs to April 2021 and the premium was either £1,250 or £775 (the policy documents are really not clear, it states both these amounts, inclusive of IPT, on consecutive pages...). The insurance is provided by Zurich and the schedule indicates the building is insured for £415k and landlords contents of £80k. The Homebuyer Report I had done suggested a reinstatement value for my ground floor flat of £140k so I guess the £415k might not be too ridiculous for the house as a whole. The contents insurance I would get separately  rather than include contents of the other joint freeholder but irrelevant for this conversation.

 

Is it just me or does this seem extortionately expensive? I thought this myself and then my solicitor made a similar comment in her final report. It seems difficult to use comparison websites for this scenario, so will probably look to speak to a provider directly but good to get a steer from others first if possible.

Chickenlips

The price seems about right. Double the amount of properties in a property will see the risk value increase. The "landlords contents" will add some additional amount to the cover, but may not actually provide the freeholders the cover they expect. Usually landlord's contents is for the communal areas only. Both parties should be taking separate contents insurance and the landlord's contents should be capped at communal items such as the carpets in the hallway and stairs (if both have access). 

This policy will be considered a commercial policy, which will also increase the value of the premium. 

There are online calculators for you to get the buildings sum insured calculated. The roof, any gardens, driveways, outbuildings such as garages, and any other building features will be included in this figure. It also needs to be enough to demolish the building, remove the debris, and hire the specialists required to draw up the spec for rebuild. It may also cover the bathrooms and kitchens (excluding contents) of both flats, so quality needs to be considered too.