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Introduction to Building Insurance For Freeholders
Freeholder building insurance is essential to protect your property investment and is different from standard home insurance. It is important not to confuse the two. Although the coverage for buildings insurance can look similar in parts to a standard home insurance policy.
A block of flats insurance policy covers buildings for properties with multiple flats or properties within a block. Freeholder buildings insurance provides peace of mind for freeholders, covering risks such as fire, flood, and malicious damage and if a joint freeholder rents out their flat, also loss of rent.
It’s crucial to understand the difference between freehold buildings insurance and home insurance to ensure you have the right cover.
Freeholder insurance/buildings insurance is a type of insurance that covers the physical structure of a property, such as a block of flats or leasehold homes, each of which are then a leasehold property. This is the same if the building is either purpose built, or converted.
Why Use Emerald For Your Freeholder Building Insurance?
We are acknowledged experts on freeholder building insurance – including when you talk to our helpful call centre staff, all of whom have been trained on the nuances and differences of freehold insurance cover.
Even better, it’s very easy to get in touch. You can see our specific freeholder page HERE, call us on 0330 113 7109 or email us at customerservice@emeraldlife.co.uk
Best Freeholder Building Insurance – Types of Insurance
Freeholder building insurance is a specific type of insurance designed for freeholders, covering the building’s structure and communal areas. The building is insured as a whole – and while it is not a legal requirement, many lenders or other parts will require a building insurance cover that covers the cost if a freeholder wants to make a claim.
Joint freeholder insurance involves multiple freeholders sharing policy responsibilities, similar to joint ownership of a house or mortgage.
Leasehold property insurance is usually the responsibility of the freeholder, but leaseholders should check their lease agreement for specific insurance obligations.
Buildings insurance cover can be tailored to meet the needs of different types of properties, including purpose-built blocks and converted houses.
Freehold insurance can include additional features such as third-party liability cover and accidental damage. Buildings insurance is usually taken out by the freeholder or freeholders and then recharged to leaseholders as part of the service charge.
Benefits of Insurance
Freeholder buildings insurance provides financial protection against major repairs or damages, ensuring the property’s value is maintained for the benefit of the leaseholders or joint freeholder.
A good freeholder insurance should include third-party liability cover for the building, protecting against legal costs if the property causes harm or damage to, say, the block of flats and can form a large part of the service charge, so it is important for you and your building to get this cover right – with the right insurance brokers and the need for the right policy.
Buildings insurance reduces the risk for freeholders owning flats in a block or building, providing cover for common areas and property damage, whether converted or purpose built, and whether or not one uses a managing agent for the building.
Freeholder insurance can help comply with mortgage or leasehold requirements, making it a vital section of property management, as mentioned above. Make sure that you know your lenders requirements, and make sure that they know you have met those requirements as they will need to know this as part of your lending requirements.
Having the right insurance policy can give freeholders some relief, knowing they are protected against unexpected events.
What’s Covered
Freeholder building insurance typically covers the cost of repairs to the fabric of the building, including flats and common areas of the building. It may also cover any out building on the property but check your policy wording to make sure, or call your insurance cover provider.
Freehold cover usually cover risks like fire, flood, storm damage, and vandalism to the flats, as well as malicious damage and accidental damage. This is something that a landlord would often require in the case of tenants who are not responsible. Again, this is something for a leaseholder who is a landlord to ask the freeholder, and the freeholder is responsible for making sure that this is covered for the landlord.
Freeholder insurance can also include cover for loss of rent, temporary accommodation, legal and other costs and communal areas.
The policy wording should be reviewed to understand coverage limits and exclusions, ensuring the right level of protection.
Freeholder buildings insurance must be tailored to meet the specific needs of the property, including the type of construction and location. Your insurer as part of their service will ask for information about the block, background, claims history etc. You are obliged as part of your service to answer those questions about the freehold honestly, otherwise your policy may be void if you may wish to claim.
For example if you apply for a freehold insurance policy and ‘forget’ that last year you made a claim for the block of flats for, say, burst pipes, then your insurer may not pay your costs under the policy in the event of any claim, not just one relating to the escape of water.
Alternative Accommodation
Freeholder building insurance can provide cover for alternative accommodation if the property becomes uninhabitable due to damage. This could include a fire at the property, substantial subsidence at your home or similar. Part of the insurance service is to provide somewhere else to stay while your home is being repaired, that is suitable and may be available quickly.
This feature is essential for leaseholders of flats, ensuring they may have a place to stay while repairs are carried out to the freehold building.
Alternative accommodation cover can be included in the policy, providing reassurance for freeholders and leaseholders protecting the freehold – and their home! – in the event of claims.
The cost of alternative accommodation is included in the premium, reducing the financial burden on freeholders or the need to source that separately.
Freeholder insurance can help manage the process of finding alternative accommodation, making it easier to deal with unexpected events.
Contents Insurance
Freeholder building insurance does not typically include contents cover, which is usually the responsibility of the leaseholder whether single flats or multiple flats.
Leaseholders should consider taking out contents insurance to protect their personal belongings. They do not need freeholder consent of this, unlike any alterations to the flats, where prior consent may be required.
Freeholder insurance can include cover for communal areas, such as carpets and furniture, but not individual leaseholders’ contents. Contents insurance can be purchased separately, providing additional protection for leaseholders.
Why Choose Emerald?
Our insurance agents and call centre staff have very strong experience in buildings insurance, providing expert explanation and guidance if you need that.
We work with leading underwriters to find suitable freeholder building insurance policies, tailored to meet specific need. Our UK-based claims team is available to assist with claims, providing a personal and efficient service when there is a need to be response and fast with covering property damage.
We understand the importance of finding the right insurance policy for your building, providing peace of mind for freeholders.
How Can You Find Us?
Our team can help freeholders navigate the complex world of insurance, ensuring they have the right options available to meet their every need.
You can see more information HERE, but to get a quote you need to call us on 030 113 7109 or email us at customerservice@emeraldlife.co.uk.
We can help you with your building insurance need, in a friendly and responsive fashion.
