Building Insurance liability in Block of Flats

[jp13abk]

Hello everyone,

I am a leaseholder in a purposed built block of flats that has 16 flats. The freeholder appointed a company to manage the building and communal areas.

The service charge that we (leaseholders) pay to the managing company includes a Building's Insurance. My questions is:

Does this Building's Insurance cover damage in my flat cause by an accidental water leak, fire, etc. that was originated inside my flat?

I asked for a copy of the Building's Insurance Certificate (screenshot below) but I don't think it answers my question.

Building's Insurance Certificate.png

[RentoRento]

It might depend on whether or not it's a demised property. In a demised premises, certain areas are transferred to the leaseholder (or owner). This can include structural elements like internal walls, plasterwork, floors, doors and ceilings. If you're responsible for these areas then you'll probably need your own buildings insurance for the demised areas. The contract of sale or demised property agreement would clearly state who is responsible for what.

[AndrewDod]

Damage to what?

If a fire burns up all of your stuff and damages your fittings -- no you will not be covered. If your bath overflows and destroys your carpets and decor, no you will not likely be covered.

[Section20z]

You need to read the policy , not the certificate.

[AndrewDod]

You need to read the policy , not the certificate.

And even if something is covered by a generic policy it does not mean that the FH should or can claim under that policy if the item is not his to insure under the lease.

[jp13abk]

Thanks for your quick responses.

RentoRento it is a demised property. As you correctly mention, there are areas that fall under the responsibility of the lessee (I'll attach the relevant lease section once I get hold of it).

AndrewDod damage to (a) the structure of my flat (walls, doors, roof, plumbing, wiring, insulation, permanent fixtures & fittings, etc) and (b) other adjacent flats.

Section20z I am still waiting to receive the policy from the managing agent.

[jp13abk]

I have re-read the lease and it seems clear: the interior of the flat must be insured by the lessee.

I've added screenshots of the relevant sections and I would appreciate if someone could confirm or correct my interpretation.

Section 4 - Lessee Covenants: lessee must insure the interior of the flat to an amount not less than 1/16th of the full value of the block of flats.

Section 6 (1) - Landlord Further Covenants: landlord must maintain boundary walls, main walls and roof of building and block of garages, communal areas, pipe & wiring serving the flats but no inside them

Section 6 (3) - Landlord Further Covenants: landlord must enforce covenants over a said lessee in case of damage done to another lessee's demised premises, with the aim of indemnifying all damage costs?

Section 8 (2) - Landlord Further Covenants: what does it mean?

Lessee Covenants.png

Landlord Covenants.png

Thanks for your help.

[jp13abk]

[AndrewDod]

I have re-read the lease and it seems clear: the interior of the flat must be insured by the lessee.

I've added screenshots of the relevant sections and I would appreciate if someone could confirm or correct my interpretation.[INDENT]Section 4 - Lessee Covenants: lessee must insure the interior of the flat to an amount not less than 1/16th of the full value of the block of flats.

Your lease makes no sense whatsoever and was drafted by an idiot.

Insure the "interior" to a value of a 1/16 of the whole "block" - what the hell.

The building sounds effectively uninsured.

etc...

[jp13abk]

Apologies, for some reason the photos I uploaded earlier were too small

[AndrewDod]

It is still a nonsense. It is asking lessee to insure a portion of something which lessee cannot insure.

[jp13abk]

Here are the two remaining lease sections that I refer to in my questions above.

[flyingfreehold]

if for example everything above floor joists in an upstairs maisonette was demised to the lessee, ie to include all structure then the lease would be perfectly okay even if not in accordance with Council of Mortgage Lenders preferences. Generally lenders dont like leaseholder to insure covenants, but they do still lend on them. The problem arises where another lessee goes off piste and refuses to renew his cover, then you are really screwed, if the freeholder doesnt cough up to keep cover in force and collect the outstanding premium as a debt from the leaseholder

[Gordon999]

In section 6(a) clause (1)(v) The landlord covenant to maintain the water pipes and drains (but not inside the flat).

So water leak originating inside the flat is repaired and paid by the leaseholder.

[flyingfreehold]

Damage to what?

If a fire burns up all of your stuff and damages your fittings -- no you will not be covered. If your bath overflows and destroys your carpets and decor, no you will not likely be covered.

But a wood floor that buckles would be considered structure and covered