Buildings insurance on a leasehold house, help please!!!

lsdav

When we bougth the house (5 years ago) we were told that the building insurance must be with the lease holders preferred insurance company.

Now i am sure i read somewhere that this law has changed, does anybody know?

The reason im asking is i can get both my buildings and contents insurance for the same amount the lease holders insurance is quoting (buildings only), any help would be much appreciated.

[Deleted User]

Hello

Am having a similar problem to this, have had buildings insurance which I have arranged for the 13 years I have lived in my maisonette. Now the freeholders , Freehold Managers plc, have written to me to say that I am in breach of my lease and if I do not take insurance through them then they will take legal action, the costs of which will be my responsibility. They have never raised this issue before and the insurance cover they are offering is 75% more than the monthly premium I currently pay. I wonder that as they have never raised this before then my position has become an "IMPLIED TERM" of the lease. Also I understand the law changed a few years ago to favour the leaseholder in this. ANY advice would be very much appreciated as it is all becoming rather worrying. I am sure they are just doing this to frighten people into taking a policy through them for which they no doubt get a commision.

magicdamo1984

i am not 100% but think that they cant force you to use the insurance company they prefer due to anti competition not sure if this is the same with leasehold but think that is the case with a standard mortgage.the FSA will be able to clarify it for you.

takoo

Isdav

Try a phone call to the relevant Ombudsman for informal advice or talk to the local trading standards staff - for financial services, estate agents or for insurance or whatever. There may be malpractice if your recollection is right.

However there may be a let out if your house is on an estate and there is an estate scheme or block insurance.

As in other threads insurance is a murky area and needs taking up at parliamentary level.

Takoo

[Deleted User]

Have done some research on the internet and found that the law was amended in 2002 which means that the Freeholder can no longer force you to insure through them. Follow this link, http://www.lease-advice.org/main.htm
The relevant section is as follows:
"Under provisions in the Commonhold and Leasehold Reform Act 2002 the leaseholder of a house is entitled to place the insurance with his own choice of insurer, as long as he gives notice to the landlord and complies with certain requirements relating to the cover arranged.
The insurance arranged by the leaseholder must:
be with an 'authorised insurer', which means an insurer operating within the requirements of the Financial Services and Markets Act 2000;
cover the interests of both the leaseholder and the landlord;
provide cover to a sum not less than the amount required under the lease;
cover all the risks which the lease requires be covered by insurance.
As long as these conditions are met, the leaseholder cannot be required to insure through the landlord's nominee".

Hope this is of help in your situation, Isdav. Am sending of the relevant paperwork to my freeholder tomorrow. Hope we both have a good result.
Thanks to Magicdamo and Takoo for the advice.

TripleNut

Apologies for dragging up an old discussion but I've only just stumbled on this thread and wish I'd found it a year or so back.

We're having the exact same issues as A1novice and Isdav with our (overly bullish) Freeholder and their nominated insurance company (Zurich) who want to charge us more than double what everyone else we've spoken to quotes for combined buildings and contents. I see from the thread that as the law has now changed we do not need to comply with this request so long as we comply with all the criteria. On this basis we'd really appreciate it if someone could clarify what is meant by "cover the interests of both the leaseholder and the landlord" as noted above and also what length of notice must be given to the landlord and what form this must take.

On a point of principle we'll do anything (well, almost) to not use Zurich as we totally object to being told who we must insure with.......any help on this very much appreciated.