Freeholder has no buildings insurance

mizzbonita

I own a leasehold flat in a converted Victorian property and there’s my flat and the flat above. The flat above is empty and it’s being sold. The owner died and the tenant was evicted. 

As per our lease agreements we buy our own separate buildings insurance for our flats. I have my own insurance. 

I’m looking into selling my flat and I enquired with the executor handling the estate for the flat upstairs about his buildings insurance policy and he advised me it expired but he will look into renewing this. It has now been 2 weeks and he hasn’t done this. He’s selling the flat but regardless it should be insured until then. 

Is there anything I could do about this? If anything were to happen to the property only my flat is insured and my rebuild cost does not cover the entire property 

mizzbonita

Should proof of buildings insurance not be in his sellers pack? 

propertyrental

mizzbonita said:

Should proof of buildings insurance not be in his sellers pack? 

Yes any buyer of his flat will want to know his insurance is in place. But that issue may not come up till the buyer's solicitor has seen and reviewed the lease and realised the seller/leaseholder has to arrange, not the freeholder as is more common.

I believe you can get an indemnity policy to cover you in the event of your co-leaseholder failing to insure...?

DullGreyGuy

mizzbonita said:

I own a leasehold flat in a converted Victorian property and there’s my flat and the flat above. The flat above is empty and it’s being sold. The owner died and the tenant was evicted. 

As per our lease agreements we buy our own separate buildings insurance for our flats. I have my own insurance. 

I’m looking into selling my flat and I enquired with the executor handling the estate for the flat upstairs about his buildings insurance policy and he advised me it expired but he will look into renewing this. It has now been 2 weeks and he hasn’t done this. He’s selling the flat but regardless it should be insured until then. 

Is there anything I could do about this? If anything were to happen to the property only my flat is insured and my rebuild cost does not cover the entire property 

So you are both selling your properties? 

Why has this matter come up? Has your buyer asked for evidence that the other property is insured? 

It would be highly prudent for you and your buyer to get an indemnity policy anyway as even if they provide a certificate of insurance today doesn't mean it was cancelled yesterday or doesn't mean they've falsely declared the rebuild value and thus their policy is voided when a claim happens. 

eddddy

propertyrental said:

I believe you can get an indemnity policy to cover you in the event of your co-leaseholder failing to insure...?

But almost certainly not in these circumstances. (Unless your solicitor arranged a policy when you purchased your flat.)

The OP knows that the other flat is not currently insured.

The indemnity policies I've seen say that the other flat(s) must be insured on the date that the indemnity policy is taken out, and your solicitor (who would arrange the indemnity insurance) should check copies of the policies to make sure they're adequate.

 

mizzbonita said:

As per our lease agreements we buy our own separate buildings insurance for our flats. I have my own insurance. 

So the executor is breaching the lease. Normally, the freeholder is responsible for enforcing the lease - so you could ask/tell the freeholder to start chasing the executor.

mizzbonita

The executor is the freeholder, well is in control of it anyway. He’s selling it with the flat. I would have thought he would be required to provide proof of insurance himself in the sellers pack? 

He keeps saying he’s going to sort it but he still hasn’t.  I’m not sure what else I can do. Speak to the agents selling the flat or his solicitors? 

mizzbonita

He’s also trying to extend the lease on the flat before it sells. I would have thought proof of insurance would be required for this or at the very least in the sellers pack. 

BonaDea

We've extended leases recently and I don't recall that the solicitor asked for any insurance details.

Do you have any sense of why he hasn't sorted it out yet?  Is he just administratively overwhelmed, or a congenital procrastinator, or trying to avoid paying out any money?  Or perhaps he just doesn't realize that he's legally obliged by the lease to get this insurance?  If you could get a handle on what's going in his mind you might be better placed to help him to get to where you need him to be.  

The other thing is, he might be at risk of failing in his duties as executor - if something disastrous happened to the uninsured flat, would the estate's beneficiaries have a claim against him?  Perhaps just asking him that would work to put a rocket where it's needed .....

eddddy

mizzbonita said:

He’s also trying to extend the lease on the flat before it sells. I would have thought proof of insurance would be required for this or at the very least in the sellers pack. 

You don't need insurance in place to extend a lease.

The "Seller's Property Information Form" asks "Does the seller insure the property?".

But when the flat is sold, the seller's insurance policy would be cancelled anyway, and the buyer would take out a new policy.  So a buyer might not be too bothered.

mizzbonita

I’m not sure wBonaDea said:

We've extended leases recently and I don't recall that the solicitor asked for any insurance details.

Do you have any sense of why he hasn't sorted it out yet?  Is he just administratively overwhelmed, or a congenital procrastinator, or trying to avoid paying out any money?  Or perhaps he just doesn't realize that he's legally obliged by the lease to get this insurance?  If you could get a handle on what's going in his mind you might be better placed to help him to get to where you need him to be.  

The other thing is, he might be at risk of failing in his duties as executor - if something disastrous happened to the uninsured flat, would the estate's beneficiaries have a claim against him?  Perhaps just asking him that would work to put a rocket where it's needed .....

BonaDea said:

We've extended leases recently and I don't recall that the solicitor asked for any insurance details.

Do you have any sense of why he hasn't sorted it out yet?  Is he just administratively overwhelmed, or a congenital procrastinator, or trying to avoid paying out any money?  Or perhaps he just doesn't realize that he's legally obliged by the lease to get this insurance?  If you could get a handle on what's going in his mind you might be better placed to help him to get to where you need him to be.  

The other thing is, he might be at risk of failing in his duties as executor - if something disastrous happened to the uninsured flat, would the estate's beneficiaries have a claim against him?  Perhaps just asking him that would work to put a rocket where it's needed .....
I’m not sure why. To be honest he has been good at dealing with other issues. I’m assuming he doesn’t want to stump up more money before it sells but you are correct, he is failing in his duties as an executor. I will have to think about how a word another message to him.