Why choose Protect My Let?
We provide you with £25,000 of cover for contents as standard and automatically include accidental and malicious damage by tenants.
We look beyond off-the-shelf solutions and work to get the right policy for your property. Need a multiple property policy? No problem. Or maybe you don’t need the maximum limits? We can help.
You won’t be talking to a chatbot with us – our approach is personal. We’re all about direct conversations, down-to-earth advice and straightforward solutions.
What is freeholder insurance?
Buildings insurance is not a requirement by law but can often be a wise precaution given the huge sums of money invested in a property – especially a large block of flats. With more residents in the property comes a greater risk of something going wrong and so it makes sense to ensure you are well protected.
Don’t make the assumption that a standard home insurance policy will cover you. Leasehold properties are not just like extra bedrooms and come with a long list of extra risks and responsibilities.
While leaseholders are responsible for their own contents insurance, the physical structure of the property is the responsibility of the freeholder. In fact, a lease is likely to require you to provide freeholder buildings insurance.
Similarly, any leasehold properties bought with a mortgage are likely to need insurance as a requirement of their lender.
The freehold to a property can be owned entirely by one person, a small group or a management company, and any of these parties can be responsible for arranging freeholders building insurance.
For instance, in a Victorian terrace the upstairs property may be leased out to another owner while the building remains the property of the freeholder who lives downstairs. In this case the person or people who own the freehold and live downstairs arrange freeholder building insurance for the whole property.
Freeholders in an arrangement like this should not assume that standard home insurance is right for them because one of the properties is leased to a third party and so requires a policy that’s more like landlord insurance.
Meanwhile in a block of flats the freehold may be distributed among the owners who form a management company. This is often structured so that anyone who buys or sells a property simply joins the company based on shares which is easier than rearranging the lease every time. In this case the legal entity responsible for the freeholders buildings insurance is the management company.
Whoever the freeholder is – an individual, partnership, group or company – it is that entity who is responsible for arranging buildings insurance for a block.
But is freeholder insurance an expense for freeholders to carry alone? Most leases include a service charge which includes a contribution to the buildings insurance. In fact this is often the biggest portion of most service charge payments.
What about joint freeholder building insurance?
If you are co-freeholders with other people then you should all be named as joint policyholders on your policy schedule. Joint freeholder building insurance should not be difficult but does require an insurer willing to go the extra mile to get the right policy for you. How do you answer a question about how long you’ve lived there or your claims history if you’re three people? You need a provider willing to pick up the phone and talk to you rather than sending you to a call centre or online form.
What does freeholder building insurance include?
When you arrange buildings insurance for a block you should look for different types of cover available. Your fundamental concern is finding insurance to protect the property itself.
However, freeholder insurance can also include features like third party liability cover to help with legal costs if your property causes injury or financial loss to someone, for instance, a falling roof tile that hits a person or their car.
In terms of cover, the whole point of a buildings insurance policy is to protect the financial investment in the building. After all, if this is your home then it is probably the biggest financial move you’ve ever made. And if it’s a block of multiple flats it is probably full of leaseholders who have also committed huge amounts of money to the property. That’s before you consider mortgage companies who require their interest in a property to be protected with adequate insurance in case of disaster.
Buildings insurance cover for a freehold property is therefore important in order to reimburse all parties in case of the complete destruction of the whole building, such as by fire. But amongst that is cover for smaller issues like burst pipes and break-ins.
Some block of flats insurance policies also include cover for accidental damage – which is basically damage you or a tenant do to the building – depending on the specific policy wording.
Then there are also potential coverages such as alternative accommodation if the property is made uninhabitable and has to be repaired.
Is it difficult to get block of flats buildings insurance?
No, it isn’t difficult, but it’s true that freehold buildings insurance is not the typical kind of policy you expect to find on a comparison site or from an insurer you see advertised on television. Generally speaking, it’s just a form of landlord insurance, and so you should be able to speak to a few landlord insurance specialists to find the right cover for you.
At Protect My Let, we’ve been helping landlords like you find better cover for your rental homes since 2004. We take it personally – there’s no hard sell, just real people going off-script to find you exclusive deals on your landlord buildings, contents and liability insurance.
If you’re looking for insurance for leasehold property or flats insurance then Protect My Let will endeavour to get you a competitive quote. Call us now to see if our insurance is right for you.
Is freeholder building insurance expensive?
Arranging buildings insurance cover for a block of flats should not be much more expensive than standard landlord insurance. That said, a lot will depend on your block of flats. A block of 50 flats obviously represents far more opportunities for mishaps that might result in a claim than a maisonette with only one resident on either floor.
One of the biggest factors in pricing this type of insurance is the rebuild cost of your block. Note that this is not the market value of the property, but the cost of materials and labour that it would cost to reinstate the property if it were totally destroyed.
For that reason it is important to get an accurate rebuild value. The most accurate approach would be to get a survey but an easier method is to use a calculator such as that provided by the Royal Institute of Chartered Surveyors. Nevertheless it is up to you to confirm the correct figure to get an accurate quote.
After the rebuild value other price factors include location, which factors in risks like crime rates and flood risk, and your own personal insurance history. You should also note the occupancy of the flats as well as any inoccupancy since some tenants are deemed lower risk than others, while an unoccupied flat is often deemed a higher risk than any occupancy because an issue like a leak may go unnoticed until more damage is done.
Different insurers will price different risks in different ways, and this can change over time. For instance, an insurer that has too many high flood risks on its books might want to reduce that number by increasing prices for those risks. On the other hand an insurer with a well-balanced book might spot an opportunity in the market and look to take on a few higher risk customers.
Therefore it pays to shop around and consider switching if you have been with the same insurer for a number of years. But remember that when arranging buildings insurance you should never rely on the cheapest provider on a comparison site as these aggregators rarely offer a full view of the market, while brands will scrimp on product features in order to rank top as the cheapest.
