insurance

If you own a block of flats, you probably have the insurance arranged already. What you may not have considered is that not all landlords' insurance policies are the same. For example, the type of cover that is arranged for a private house may not adequately protect some interested parties such as leaseholders and their mortgage lenders.

Different insurance needs exist when looking at various forms of property; for example blocks of purpose-built flats are quite unlike houses that have been converted or, indeed, ordinary homes. The basics of cover may be similar, but the way insurance companies view the ‘risk' will not be. This is because the property could be built differently, or occupied by more than one family, but the difference is far from academic; if your insurance is not the right sort, you could be landed with unpaid – or only partially met – claims.

Owners of blocks of flats should ensure that they have ultimate control of the insurance. Leaving it to the leaseholders or tenants could leave you with incomplete cover; but being in the driving seat also ensures that there is no debate over whether all parts of the building are covered. After all, if each flat were to be individually insured, questions could arise regarding whether the common parts are covered.

When considering landlords' insurance for blocks of flats, you should ensure that the insurance broker or company you are talking with fully understands the nature of the property. If they are in any doubt, it is important to tell them the construction and nature of occupation.

You should ensure that you have the full range of cover, including ‘accidental damage' if required. You should also check that loss of rent, liability and legal expenses insurance is also arranged. In particular, it is essential that you have employers' liability insurance if you employ anyone to clean part of the premises or undertake maintenance or repair work.

Looking for the ‘cheapest' insurance is almost always the wrong thing to do. Nobody wants to pay more than they need to for something that they hope will never happen; but it is important to be sure that your blocks of flats insurance will be there to pay out if necessary. If insurance companies fully understand the nature of the property they are covering, they will be more inclined to charge a fair premium and to pay claims promptly should the need arise.

It is important to seek independent professional advice before making any decision about insurance for landlords and liability insurance as well as your financial obligations. You should always ask your insurance advisers what experience they have of dealing with residential and/or commercial rental property insurance.