If you are a landlord or part of a Right to Manage scheme with a block of flats under management, the following FAQs and responses might prove useful.
What exactly is a block of flats?
While we all think we know what this means, in practice, it’s slightly more complex.
It could be anything from a skyscraper to an ordinary sized property divided into a number of separate lettings. Broadly speaking, the size doesn’t necessarily matter because it’s really a question of whether or not the property is split into more than one separate letting space.
As such, there is a grey line sometimes between a House in Multiple Occupation (HMO) and flats. Again, in very general terms, if tenants have their own bathrooms and kitchens then the property is probably defined as ‘flats’ rather than an HMO.
The laws and definitions here are complex and their interpretation might even vary from one UK country or local authority area to another. You can obtain clarification from your local authority.
What is clear though is that whether you have flats or an HMO, you will need special landlord insurance to protect your interests. That might be block of flats insurance or HMO cover.
Why is special cover required?
There are many physical characteristics of a block of flats that make it a significantly different risk proposition to, say, a standard single-occupancy house.
- there will typically be more tenants on site;
- the increased numbers of kitchens and bathrooms increases flood and fire risks;
- common areas may exist, such as lounges, foyers, staircases and so on;
- there may be far more coming-and-going by footfall, such as tradespeople and that could increase accident risks and public liability claims;
For all these reasons and many more, it is imperative that you have the appropriate insurance in place.
What does the law require of insurance?
The law here differs in England, Scotland, Northern Ireland and Wales. There might also in England be very different regulations depending upon your local authority area.
Space doesn’t permit a full discussion of all these combinations but again, broadly speaking, you may find:
- letting a block of flats will involve you in satisfying more demanding safety and compliance standards than those that apply to typical single-occupancy landlords;
- it will be necessary to formally register and likely that full professional insurance will be required as part of that legal registration process.
What about if I’m part of a housing or property collective?
This will not change the obligation of a responsible entity to provide appropriate and all-embracing insurance cover for the property as a whole, rather than just individual tenants insuring their own part of it.
Special policies for housing associations and co-operatives do exist and a specialist in block of flats insurance should be able to help further.
Why have I been told that I need public liability and employer’s liability cover?
These are two very different questions:
- public liability insurance protects you from the financial consequences of claims against you for injuries arising to others as a result of your property. This is touched on in one of the above examples about tradespeople. For example, a telephone engineer injured following a fall on the staircase of your flats might sue you for compensation;
- if you have employees or even people working casually for you on or around your flats (e.g. a one hour per week garden tidier), the law might deem them to be your employee and if so, you may be legally obliged to provide employer’s liability insurance. It’s worth taking advice on this before assuming that it doesn’t apply to you.
Please feel free to contact us on 01992 307101 – we will be more than happy to help.