Block of flats can be insured differently than normal properties. If you own or manage an apartment block, regular buildings insurance policies will not provide the satisfactory level of cover you need to protect your investment.
Block of flats insurance is a type of insurance meant for larger properties that contain multiple rental properties. This flexible insurance policy type can even be used in homes that were converted into flats. Management companies, leaseholders or freeholders can take out block of flats insurance to provide exceptional cover at a lower rate.
Specifically designed for apartments or a block of flats, this cover can include:
- Liability: Meant for the property owner. Liability that is 5 million pounds is not uncommon and will protect the owner of the property from liability.
- Loss of Rent: One of the biggest losses of money for a landlord. When a property is void, loss of rent occurs, eating into potential profits. Loss of rent will provide monetary relief during times when tenants are not actively letting a property.
- Alternative Accommodation: What happens if a fire breaks out and ruins a tenant’s room? Oftentimes, landlords will need to find an accommodation for the tenant while the home is repaired. This is what alternative accommodation will cover.
- Loss or Damage of Property: Theft, natural disasters and fire causes landlords to lose billions of pounds per year. Proper cover for these items is provided.
These are the basics that may be covered under one policy. Liability amounts are often high to ensure that a landlord and all of his or her properties have more than enough cover.
There are also a few questions you’ll want to ask your insurance provider. Every policy has exclusions, and knowing what exclusions or limitations your insurance has is key to properly covering your investment. Common exclusions include:
- Restrictions on certain cover when a property is unoccupied.
- The cost of replacing undamaged items.
- Loss of a building that is not listed within a policy.
- Damage caused by negligence, or a design or manufacturer fault.
- The number of properties that can be insured under one policy.
Some insurance policies will include all of the above, but many will have restrictions in place. The good news is that optional insurance cover may be able to be sought so that you can have the cover you need in the event an exclusion criteria is met.
Customized policies are also provided. These are policies that will change due to the amount of properties in your block. If an entire apartment block is being covered, the insurance policy limits will need to be altered to best protect you – the landlord. It’s important to be open and honest with an insurance provider at all times.
Properties that are not listed on the policy will not be covered. Always ensure that all properties you own are included on the policy, or you risk the chance of not being covered and taking full responsibility for the costs of damages and any repairs needed.
Block of flats insurance should be discussed with your insurance provider.