This is one of the most important responsibilities of the Landlord or Freeholder. If you are a Resident Management Company and own the freehold, you will be responsible to ensure this has been put in place – if you are a Right to Manage Company and do not own the freehold, we recommend that you ensure you are happy with the insurance which has been put in place by the Freeholder or Landlord.
Cardinus Risk Management can offer a very comprehensive service with regard to all insurance issues. One of the most important traps to avoid is underinsurance. Here are some observations to consider:
“Leaseholders should beware that index linking alone may not provide them with the real cost of rebuilding when insuring blocks of flats, warns specialist insurance broker Deacon. The reminder comes after a Glasgow block was found to be underinsured by over £1m – or 24%.” Arthur J. Gallagher group, 2014.
“Latest research by the RICS Building Cost Information Service, found that 80% of commercial properties are underinsured.” RICS, 2012
“Landlords have been warned not to underinsure their properties, after one landlord was left out of pocket to the tune of £100 000.” 2012 Letting Age Today.
So how to ensure your property is adequately insured:
The simple answer from Cardinus Risk Management is to arrange for the property to have a Reinstatement Cost Assessment (RCA) conducted by a professional company on a regular basis. This is a professional valuation which provides a complete assessment of the property rebuild costs. It takes into account the cost of labour and materials, access to site, removal of debris and a variety of other factors. Other considerations include whether the building is listed, has unusual fixtures and fittings, or VAT costs, where appropriate.
Having a professional RCA completed means that the property will be correctly valued in the event of a loss and will avoid the perils of underinsurance.
Cardinus has a team of UK-wide professionally trained surveyors carrying out surveys and assessments for the insurance market.
This superb service will enable our RTM and RMC Companies to make an informed choice about their insurance needs. Whom you choose to insure your block will be decided by the directors.
If you are thinking about looking at your insurance needs including an updated RCA, after getting advice from Cardinus we suggest you begin by contacting Residentsline who are able to offer not only building insurance but also insurance for your directors and officers of the Right to Manage or Residents Management Company.
As with our Cardinus partnership, it is important to stress, that 2 Rivers does not have a financial, corporate or personal relationship with any insurance broker or company. Their fees and charges are calculated separately without kickbacks or commissions of any kind.
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