Who pays for block of flats insurance — the freeholder or the leaseholders?

The freeholder is responsible for arranging buildings insurance, but the cost is typically recovered from leaseholders through the service charge. The lease will set out the mechanism for recovering insurance costs. Leaseholders have the right to request details of the policy and to challenge unreasonable costs.

What is a reinstatement cost assessment and do I need one?

A reinstatement cost assessment (RCA) is a professional valuation of the cost of rebuilding the property from scratch. It is the most reliable way to ensure the building is insured for the correct amount. Underinsurance is a significant risk for blocks of flats, and an RCA helps to avoid it. Many insurers require an RCA for larger blocks, and it is good practice for all blocks.

Does block of flats insurance cover individual flats?

Block of flats insurance covers the structure of the building and communal areas. It does not typically cover the contents of individual flats or improvements made by leaseholders. Individual leaseholders should arrange their own contents insurance and may need to insure any improvements they have made to their flat.

What happens if a leaseholder causes damage to the building?

Most block policies include cover for accidental damage caused by leaseholders or their tenants. Some policies include a provision that waives the excess for claims arising from leaseholder negligence. You should check the specific terms of your policy.

Can a residents management company arrange block insurance?

Yes — a residents management company (RMC) or right-to-manage (RTM) company can arrange block insurance on behalf of the leaseholders. Directors of these companies should also consider directors and officers liability insurance, as they can face personal liability for decisions made in their capacity as directors.

Block of Flats Insurance: A Complete UK Guide

Block of flats insurance covers the buildings and communal areas of residential blocks. This guide explains the difference between freehold, leasehold, and RMC cover, and how to arrange the right policy for your block.