building insurance
📖 O que é building insurance? Significado e conceito
Building insurance is a type of insurance that covers the cost of repairing or rebuilding the physical structure of a property, such as the walls, roof, and foundations, in the event of damage from incidents like fire, floods, or storms. In the context of UK tenancy, particularly for leasehold flats or maisonettes, the landlord (or lessor) typically arranges and pays for the building insurance for the entire building. The cost of this insurance is then passed on to the tenants (or lessees) as part of their service charges.
Disputes often arise regarding these charges, with tenants challenging whether the building insurance charges are payable under the terms of their lease, if they have been reasonably incurred, and if their contribution has been correctly calculated. Tribunals, such as the First-tier Tribunal, are often asked to determine the reasonableness of these service charges, including the insurance premiums and any related valuation fees.
It is crucial for tenants to review their lease agreement carefully, as it will specify the landlord's obligations regarding insurance and the tenant's responsibility to contribute. Leases typically require building insurance only, meaning landlords may not be entitled to recover costs for other types of insurance, such as landlord's contents insurance, through the service charge. Tenants may also challenge the landlord's rejection of alternative insurance quotations if they believe the landlord's chosen policy is not cost-effective.
📋 Requisitos
- The building insurance charges must be payable under the specific terms of the lease agreement.
- The insurance charges must have been reasonably incurred, as defined by section 19 of the Landlord and Tenant Act 1985.
- The tenant's contribution towards the insurance premium must be correctly apportioned in accordance with the lease.
- The insurance policy should cover building insurance only, unless the lease explicitly states otherwise.
📝 Procedimento
- Applicant (tenant) raises challenges regarding building insurance charges for specific service charge years.
- Applicant questions the payability of charges under the lease terms and if they were reasonably incurred.
- Applicant may propose an alternative insurance quotation for consideration by the landlord.
- The tribunal determines if the charges are payable, reasonably incurred, and correctly apportioned.
- The tribunal may make orders regarding the apportionment of premiums or disallow certain charges.
💡 Exemplos
- A tenant challenged their landlord over building insurance charges, arguing that the landlord's policy of allocating a higher proportion to a newer block of flats was unfair and should be equally apportioned.
- A leaseholder disputed the inclusion of landlord's contents insurance costs within their service charge, asserting that their lease only required them to contribute to building insurance.
- A group of tenants questioned whether the interim revaluation charge for building insurance, amounting to £134.02, was a payable expense under their lease agreement.
- A tribunal ruled that building insurance premiums for several service charge years were reasonable in amount and fully payable, but also ordered that the premiums should be apportioned equally among all flats.
📚 Base legal
- Landlord and Tenant Act 1985
❓ Perguntas frequentes
What does 'building insurance' cover in a leasehold property?
Building insurance typically covers the physical structure of the property, including the roof, walls, and foundations, against damage from events like fire, floods, or storms. It does not usually cover the tenant's personal belongings.
Can my landlord charge me for building insurance?
Yes, if your lease agreement states that you are responsible for contributing to the building insurance as part of your service charges. The lease will outline the terms under which these charges are payable.
How can I challenge building insurance charges I believe are too high?
You can challenge the charges by arguing they are not reasonably incurred or not correctly apportioned according to your lease. You may also present alternative insurance quotations to your landlord. If an agreement cannot be reached, you can apply to a First-tier Tribunal.
What is the 'Landlord and Tenant Act 1985' in relation to building insurance?
Section 19 of the Landlord and Tenant Act 1985 is often cited in disputes, as it requires that service charges, including building insurance premiums, must be 'reasonably incurred' for them to be payable by the tenant.
Can my landlord charge for landlord's contents insurance if my lease only mentions building insurance?
Based on tribunal decisions, if your lease only requires building insurance, your landlord may not be entitled to recover the cost of landlord's contents insurance through the service charge. You should check your specific lease terms.
What if my landlord rejects my alternative insurance quotation?
If your landlord rejects your alternative quotation, you can challenge whether their rejection was reasonable. A tribunal may be asked to determine if the landlord acted reasonably in rejecting your proposed alternative.