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So, you may need to arrange buildings insurance for your freehold property (note: not your leasehold policy – more of that later!).
This may be because you own a leasehold property in a block of flats, and the block of flats needs cover (and you kindly volunteered!) or you may just own the freehold for a block of flats and need freehold buildings insurance.
There are some other, more unusual cases where you may need to arrange buildings insurance cover, but those are the main two cases where you may need a buildings insurance policy.
As for what buildings insurance covers, read on and see how Emerald can help you.
Apart from this blog, you can find out much more about freeholder insurance, whether for a block of flats or otherwise, and arranging buildings insurance cover on Emerald’s freeholder home page on our website….
If you are looking for Insurance for your freehold make sure to contact us here
The basics – what are we talking about re buildings cover?
Many people are not aware of what building insurance for freeholders is, or what it covers – so for example, what liability cover do you have, is it part of the service charge, is there third party liability cover, is it part of the ground rent, etc.?
Let’s deal with some of these now.
What does it cover?
So, if you are a block of flats you will need cover for the buildings, and the stuff inside (your contents).
Contents will need to be covered by each leaseholder with their own contents cover, but buildings will need to be done by the flat owners jointly – there is no such thing as leasehold buildings insurance – whether as individuals, as a joint responsibility or through a management company or residents association if there is one.
The building insurance will cover the entire building, and the communal areas, exterior and common parts.
Is it part of the service charge/ground rent?
In short, yes. If you are a leaseholder you will pay general service charges and that will include your share of flats building insurance as well as general maintenance costs, cleaning of communal areas, costs of communal gardens etc.
The amounts charged by the freeholder (or joint freeholder if it is more than one leaseholder rather than a management company) should also include an extra amount to build up a sinking fund.
The outline – what else am I looking for?
Building insurance, also called building owners and tenants insurance, covers the building against physical damage caused by fire, windstorm or other disasters. Building owners can purchase this coverage through an insurance company to help protect themselves in case of a catastrophe.
If you’re looking for building insurance for freeholders then look no further! We offer affordable rates that will suit any budget and we have many different packages available so you can find one that is right for your needs.
Call us now to get started on improving your home’s safety today!
You can call us on 0330 113 7109 or click here for our freehold page
Who’s responsible for leasehold buildings insurance?
So first thing is to be careful about terms – this is technically freehold buildings insurance, not leasehold buildings insurance or flats buildings insurance.
If you ring up an insurer and use those terms they may not understand you (although not at Emerald – although we cover most home insurance one of our specialities is freeholders building cover.
The responsibility of purchasing building insurance is normally the owner of the freehold, and will be collected as part of the service charge.
If you own a leasehold you should check with your freeholder so they can arrange cover if it has not already been covered. Insurance cover can save you thousands if something is to go wrong to your building.
But – it does not help if you have the wrong policy (for example and standard home insurance policy cover home and contents – where there are multiple flats then there will need to be a single freeholder policy covering the same building.
Freeholder building insurance is not a legal requirement for your freehold; however, it’s advisable in case any of your leasehold properties as any accidental damage can cost a lot.
What if I own a block of flats, rented out, as an investment?
There are some nuances if you are a freeholder and also own the flats as a purely rental investment.
You may also require contents insurance for your freehold if you rent out the flats to people. Freeholder buildings insurance can help protect both flat owners and their tenants in case of damage, loss or theft, as well as providing alternative accommodation.
Alternative accommodation pays out if the building becomes uninhabitable (or technically, the leasehold flats) because of an insured risk such as fire.
But of course, if you own flats insurance is only part of the issue. You should make sure that you have a proper tenancy agreement for each tenant, who should also be DBS checked. If you are also looking for a competitive price, it will be cheaper to rent the flats to professionals rather than students, for example.
If anything was to happen that would cause an unexpected expense then having this type of cover could really benefit you as it may save you thousands down the line.
What do we now know about freeholder building insurance? The technical part!
Freeholder insurance is a type of insurance that covers buildings for freeholders, these are usually the landlord or property owners.
A freehold is a space of land completely owned by the landlord including the area of land it is on. Someone living in a flat will have leasehold cover (contents) but freehold cover is for the owner of the freehold. So, it’s important to check with your landlord (or their managing agent) as it’s important to know before arranging buildings insurance that they have this sorted.
Building Insurance is a policy designed to protect both flat owners and their tenants in case damage occurs.
Freeholder building Insurance can sometimes but rarely be known as building plans insurance which means that they cover the bricks and mortar not contents.
What does buildings insurance cover?
If you are looking for building cover you may want to understand exactly what it covers. freeholders buildings insurance will cover the cost of your building which excludes positions inside. The same applies to a leasehold flat, the cost of your possessions can be covered by contents insurance, its important to understand what your insurance policy covers before purchasing it or unexpected damage could happen that you are not covered for.
If you own multiple properties with high market value you will want to ensure the whole building has insurance. Any investment made in property could be completely lost by a freak accident if you are not covered this would be a major setback.
Do I need buildings insurance for a freehold flat?
If you own the flat as a freehold it will be your responsibility to check you have freehold insurance. It is up to the landlord to get the property insured.
You may also look to purchase other insurance for your freehold flat like landlord insurance,
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Block of flats buildings insurance/buildings insurance FAQs/service charge liability/general insurance questions