Share of Freehold building insurance?

Share of Freehold building insurance?

15:05 PM, 5th September 2018, About 4 years ago 22

Text Size

I am the owner of a flat (1 of 4 in a converted house). Each of the owners is also a freeholder.

Recently one of the flat owners decided he no longer wants to contribute to the whole buildings insurance and would like to do his own insurance (for his flat only)!

If he does that then the remaining 3 owners will have to pay extra or if everyone does their own insurance the communal areas won’t be covered.

Has anyone been in this situation before and could offer some advise?

Many thanks

Nick



Comments

by Seething Landlord

17:47 PM, 9th September 2018, About 4 years ago

This is an extract from the article referenced previously:
"A. Maisonette style lease (Tenants to insure and repair building).
This will match your current arrangements we suspect. It is only really suitable for 2 flats in the building although in theory lenders will accept this arrangement in units up to 4. Generally this is where the upper flat is responsible for all parts of the building (including structure and main roof) from the level of the joists of the floor separating the property from the lower flat and the lower flat is responsible for everything up to the ceiling of the lower flat including the mains walls of the flat and the foundations). Each flat owner is also responsible for the insurance on their own part of the building.
The insurance arrangement is often criticised by lawyers because there is no way of easily monitoring that your neighbour has insurance on risk each year and they envisage a problem if the building is damaged by an insured risk causing damage to both properties. What happens if one of the flats is uninsured? – the insurance payout for the remaining flat may be insufficient to enable that flat to be rebuilt or repaired in full. You can get “contingent buildings indemnity insurance” to insure against the risk of your neighbour not complying with his insurance obligations but in our view it is better not to choose this option."

by Puzzler

18:48 PM, 9th September 2018, About 4 years ago

Agreed, it's not the best option. I repeat you need to talk/write to this person first and find out what their agenda is. Let them arrange it for the block, maybe they just feel that they're not involved in the decision.

When is it due for renewal? If that does not work let us know.

Why does this site put backslashes before apostrophes?


Leave Comments

Please Log-In OR Become a member to reply to comments or subscribe to new comment notifications.

Forgotten your password?

BECOME A MEMBER

Landlord Tax Planning Book Now