Buying leasehold getting odd advice about buildings insurance

[DollyDagger]

Hello

I am trying to buy a leasehold flat. The lease specifies that the management company should arrange buildings insurance. The trainee solicitor dealing with my purchase has made the following statement.

 

“In any event it is Essential that you should consider insurance generally with your broker. (I don’t have a broker) It may be necessary to carry additional insurance cover not merely for  contents but also (for example) items which may be regarded as part of your flat such as interior non load bearing walls, internal doors, internal plasterwork and all decorations.”

 

So they’re insuring the building except the bits of it that I am buying? But I am buying some exterior load-bearing walls! So that it doesn’t make sense to me. Also this word may maybe be regarded. By whom? 
 

Am I to believe that a broker will know what the insurance cover the landlord/management company has and be able to advise me on what bits I need to top up the cover, because that is the message I am getting from the trainee solicitor if I understand correctly which I might not.

 

I have had a Leasehold property enquiry form which claimed insurance policies on schedules with it, but only had a schedule of the buildings and nothing at all for the communal areas, corridors stairs et cetera. So how can I approach the broker when I don’t even know what the insurances?  How can Broker quote me for cover for things that might not be covered because somebody thinks they are part of my flat?  is there some secret knowledge that they have? Again that is the impression I’m getting from the trainee solicitor dealing with my case.

Can you help on this welcome I am tearing my hair out. Thank you

 

 

Edited February 16, 2022 by DollyDagger
Getting quote accurate

[mantis shrimp]

Have you considered asking the trainee solicitor's supervisor? You are paying for the solicitor's advice, so are entitled to ask for clear advice, and also to seek clarification if you do nut understand the advice or find it confusing.

[stu007]

Hi

 

Does this specific Solicitor you got have specific knowledge in Leasehold/Housing Matters as they should be asking these questions.

 

What you need to do is speak directly with the Management Company you are dealing with for the Leasehold Property and ask them to Clarify exactly what their Building Insurance Cover. (does it cover the entire Building, Lifts, Communal Areas, Floods, Fire, Water Leaks, Storm, Falling trees, Malicious damage) 

 

Does the Leasehold Agreement state in it that Leaseholders are required to have their own Building Insurance you need to check this.

 

Are you paying a Service Charge in your Leasehold Agreement for Building Insurance something else to ask.

 

If you are purchasing the Leasehold via a Mortgage you should check with the Mortgage Company on any requirements to have Building Insurance as they may stipulate it as a requirement but you need to check.

 

Couple of links of Interest:

 

Living in Leasehold Flats - A guide to how it works - The Leasehold Advisory Service

WWW.LEASE-ADVICE.ORG

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A guide to how it works with an explanation of the nature and typical rights, responsibilities and obligations that relate to the ownership of a leasehold...

 

 

How do I insure a flat? - HomeOwners Alliance

HOA.ORG.UK

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When you own a flat you have a stake in the building but may not own the bricks and mortar. Here's how to insure a flat.

 

[Ethel Street]

The starting point is what the Lease says about (a) what the Leaseholder is responsible for and (b) the insurance obligations of the parties, in particular what is defined as the 'buildings' that the Freeholder/Management Company must insure. Not what the Management Company's policy says.  Have you seen the Lease?

 

Once you know what the Lease says you (or an insurance broker) can check whether your Contents policy covers what you are responsible for. 

 

The solicitor's advice isn't wrong although his example that non-load bearing walls and internal doors may not be part of the building is a somewhat unusual possibility, but it's not impossible. More common examples of things that may be part of either 'buildings' or 'contents'  are fixtures and fittings like baths, showers, fitted kitchens. What the Freeholder/Mamagement Company does about insuring the common areas isn't really a concern to you as I assume they aren't your responsibility under the Lease.

 

You are responsible for insuring what the Lease says is your responibility. Nothing else. 

[unclebulgaria67]

Quite often the Buildings Insurance for flats will only cover the outside walls,  windows, interior load bearing walls, roof, communal lifts, stairwells.

 

As Ethel Street has said, what you can do is work out the approximate cost to cover interior partion walls, Kitchen, Bathroom and include this under your Contents Insurance.  But you don't normally include it within the Contents value and instead you ask the Contents Insurers to cover what would in a normal house be Building items.  There is a reduced rate for the Building items as they are fitted items and would not attract the same premium rate as Contents.

[DollyDagger]

Stu007 I don't know what the firm should and should not be asking which is part of my problem. They sent me an LPE1 form which said various insurance related things, including policies AND schedules were enclosed without sending me either policies or schedules.  The same LPE stated it had enclosed the Management Companies articles of association and was attached to an email from said trainee stating that I could find out all I needed about the company from 'Companies Houses sight' (SIC). No articles of association came for some time to me, and then only when I asked for them point black. It wasn't helped b the fact that the LPE and other documents were sent electronically upside down. I asked them not to do this and by return of email they did it again! 

 

 

[DollyDagger]

Ethel

Yes the lease. That has problems as in places it has the wrong flat number. The preamble states that 'property' in the document will mean one thing and then plainly uses it in other senses.  Its author and correct use of commas seem not to have been acquainted.

 

It sets up the management company who when all the leases were sold would take over the freehold and now holds it and I get two shares in this.  But there is a management agent who sorts things.

 

 

lease extract - Copy.pdf

[DollyDagger]

Ethel

 

Well the lawyer got back to me when I asked about the non load bearing walls bit, and says that non load bearing walls are NEVER covered by insurance. It seems that after writing the report I quoted from they did some research.  Yes, I know, it does seem base over apex to me too!. 

 

I have read this a few times now and still find it a bit opaque.

Non-load bearing walls aren’t usually covered by any insurance. This is due to the fact that the only time that you would likely need to rectify damage to these is if the whole building was damaged, in which case the management company would sort this, or if, during your enjoyment of the property, you caused damage to these walls that you would then need to rectify. Insurance of the non-load bearing walls is something that, in our experience, clients have never needed to obtain or rely on. Insurance companies also aren’t likely to provide separate cover for just the internal non-load bearing walls given the reasons above but, if this is something you are wanting to cover, you may need to contact various insurance companies or contact an insurance broker so they can advise you more clearly on how this can be added to your insurance premium.

 

They have forgotten they are the ones who told me it was necessary that I consult an insurance broker as in the quotation I started off with. And they gave the example.  SO their initial advice just left me thinking what else might be regarded as and I quote it 'part of my flat' and therefore not insured.  

 

So even if I have no legal obligation to take out this additional insurance, my worry is that if I don't I' could in theory end up with no internal plaster, internal doors or non load bearing walls. which might not be nice.

 

 

 

 

 

 

 

[DollyDagger]

Uncle Bulgaria

I did try contacting my contents provider, but even after keeping me hanging on they got no further than saying they were not allowed to provide buildings cover if I already had it even when I said I had been warned that my buildings cover might not include the items on the list I started the thread of my quoting.

It would have helped if the insurance policy documents had been enclosed with the LPE but if they were they were not passed on to me and I think my conveyancers are saying they never had them. It makes it difficult to try to get insurance to cover these gaps when you don't know what you are covered for1

thanks

 

 

[unclebulgaria67]

Whoever you spoke to at your Contents Insurers is talking nonsence.  For leasehold flats, is is very common for Contents Insurance to be extended to cover the items which the flats Buildings Insurance does not cover.

 

Try contacting them again and ask them if it stated in their underwriting guidance that they are not allowed to cover Kitchens, Bathrooms, internal walls for a leasehold flat.

[DollyDagger]

Thank you I will try getting back to them it was LV whatever it is. However, I now have a little bit more information.

 

I’ve received something called an LPE form. I note with some annoyance that the trainee solicitor will also have had a copy of this. It claims that enclosed with it are two sets of insurance schedules  and policies. One relates to buildings and one to managed areas.  But I have received neither from the conveyancers who sent me the form. (And I didn’t get the articles of association also said to be enclosed with it until I specifically requested them sometime later.) it didn’t help that this was one of the documents they sent to me upside down. When I bemoaned this they told me to print them off as this would make it easier to read them. I just can’t believe this attitude to customers and at this point I did, as a now vanished  comment on this thread suggested, if I read it right, reach out to the supervisor of the trainee solicitor. A large bundle of printed-off documents arrived quite quickly!

 

I’m sorry but this thread seems to be as much about my dissatisfaction with the conveyancing I have received, over the roughly 4 months it is taking them to buy me a flat, as it is about insurance, though obviously I am concerned to be correctly insured.

 

The LPE had been completed by the management agents. (They accidentally put the wrong firm down as landlord, which took me some time to get sorted out in my mind. I thought it might be a mistake but lacked the confidence to say so, and it was and at the end of the day they said so and apologised. It’s one thing after another after another…… but I digress.)

 

So I contacted the managing agents and they have promised to send me the missing policy documents, and an up-to-date one at that because it’s gone on for so long that the one they sent is now out of date!

 

But they did send me a definition of buildings from the AXA policy.  They said it covered all the items in my list, but I’m not quite sure which items from my email to them they regarded as my list, and I’m a bit nervous of approaching them again and being a nuisance to not to mention delaying things still further.

 

I’ll dig it out and quote it. Grateful for peoples opinions on whether it covers nonload bearing walls, and the other items in the trainee solicitors original list of examples.

 

apologies for typos etc. 

Edited February 19, 2022 by DollyDagger
Correcting typos etc

[DollyDagger]

It is Arch insurance not AXA, sorry

[DollyDagger]

Well the handler has now left the firm. Second one. No new person named. I am so upset.

 

[unclebulgaria67]

Arch Insurance are a Canadian company who now provide Insurance in the UK.

 

Given that they are not able to provide Contents Insurance that meets your requirements, perhaps you need to cancel and arrange a new policy elsewhere.

[stu007]

Hi DollyDagger

 

How is this progressing at the moment?

 

I assume you are paying for the services of this Solicitor and the Conveyancers? (could you clarify)

 

As for the Conveyancers attitude to just print off the document that is disgraceful especially if you are paying them for a Service
they should have sent you that document correctly. (if it is in PDF format you do realize in the PDF software you use you can rotate the document
to the correct view then save it)

 

As for the Document being sent to yourself saying X Document is attached then these should be attached whether it is the Solicitor/Conveyancer sending these as you need to see the full documents to be able to make an informed decision as to this Leasehold Property if they have not sent these with said document then you need to contact then and insist that you are sent copies of the attached documents. Don't let them mess you about you are paying for there services not the other way about.

 

Also remember with the Solicitor firm you are using you would have signed an Agreement with them to provide this Service to yourself and IMO I think you need to get that agreement and sit down with a nice cuppa and either have a pen/highlighter and read through the document a couple of times and as you read through it just ask yourself 'DID THEY DO THAT' (bearing in mind how you have been treated by them from the start to date irrespective that it's a trainee solicitor that is that firms responsibility not yours.

 

This way with the above you are building a case to make a Formal Complaint to that Solicitors Firm about there action or lack of.

 

The same goes for the Conveyancers.

 

You do not have to action any of this if you don't want to but this way you can build your evidence if it is required at any stage to make Formal Complaints to both.

[mantis shrimp]

if you buy on price, you may not get the best quality. 

[DollyDagger]

On 04/03/2022 at 01:50, stu007 said:

Hi DollyDagger

 

How is this progressing at the moment?

 

I assume you are paying for the services of this Solicitor and the Conveyancers? (could you clarify)

 

As for the Conveyancers attitude to just print off the document that is disgraceful especially if you are paying them for a Service
they should have sent you that document correctly. (if it is in PDF format you do realize in the PDF software you use you can rotate the document
to the correct view then save it)

 

As for the Document being sent to yourself saying X Document is attached then these should be attached whether it is the Solicitor/Conveyancer sending these as you need to see the full documents to be able to make an informed decision as to this Leasehold Property if they have not sent these with said document then you need to contact then and insist that you are sent copies of the attached documents. Don't let them mess you about you are paying for there services not the other way about.

 

Also remember with the Solicitor firm you are using you would have signed an Agreement with them to provide this Service to yourself and IMO I think you need to get that agreement and sit down with a nice cuppa and either have a pen/highlighter and read through the document a couple of times and as you read through it just ask yourself 'DID THEY DO THAT' (bearing in mind how you have been treated by them from the start to date irrespective that it's a trainee solicitor that is that firms responsibility not yours.

 

This way with the above you are building a case to make a Formal Complaint to that Solicitors Firm about there action or lack of.

 

The same goes for the Conveyancers.

 

You do not have to action any of this if you don't want to but this way you can build your evidence if it is required at any stage to make Formal Complaints to both.

 

[DollyDagger]

I cannot find any statement of what they will do only pages and pages of terms and conditions.  They are telling me 7 months is the new normal time to get moved  because of COVID. I am buying an empty flat from executors and according to the estate agent selling to a cash buyer. I don’t know who to believe any more as my conveyancing firm cited problems with the solicitor of the lender of my buyer as if he were not a cash buyer.  Seven months seems a long time even if as the estate agent said some of the forms are very long. They all blame each other. Since the estate agent put me onto this via something called ‘Move With Us’ I got grim satisfaction from the fact that the estate agent could not get through to them on the phone either. She threw a wobbly and got through to an office manager who blamed my vendors solicitor but when speaking to me she blamed the solicitor of the purchaser’s lender which contradicts the estate agents assertion that it is a cash buyer. 
 

 

Edited April 26, 2022 by DollyDagger
Clarification

[DollyDagger]

On 26/04/2022 at 13:12, DollyDagger said:

I found what might be their service standards. They are regulated by a coveyancing body and in one of their long letters is a link to that body’s standards.  Getting them to realise I needed time to book a removal van was a nightmare as they don’t answer phones or read emails. Even the estate agent had to go through to the complaints person to get a response. I was at my wits end. I did ring the removals firm and asked ‘If I ring you tomorrow (Thursday) to ask you to move me on Friday could you.

?’ They laughed and said tell your solicitor they can’t do that. But as said if they don’t answer the phone or read emails how can you. Anyway, it is now 7 months since I saw the flat I wanted to buy and hopefully I shall get moved soon.

Regarding the insurance, the management company for the block were helpful and sent me full details, so IF I ever get a completion date I ca get it checked out by a broker.  
 

My general advice would be avoid letting the estate agents refer you to a ‘solicitor’ at all costs. If you can find a real live one with an office near you, do it.  Some of them seem to give ‘teams’ which was basically two people in my case as far as I could see, neither fully qualified, over one hundred cases. Ever likely they did not remember from one email to the next (which might be almost two months later) that I had told them they had not sent me the form they once again told me to read and check. They then turned round and said they didn’t even know if they had ever had it themselves. They could not find it to send me one and the solicitor for the vendors said he had sent it, but they had to ask for another one, this about three months after he would have sent it the first time. Then they criticise him for being slow, 

 

The worst scares about the buildings insurance not covering stuff like toilets and sinks as suggested by the conveyancer/trainee solicitor covering my case turned out not to be realised,  still not sure about decorations and non load bearing walls. The solicitor in charge of the team  said they wouldn’t be covered because I could take them with me.  Odd idea I thought.  But life is odd

 

 

 

[stu007]

Hi DollyDagger

 

Thanks for the update much appreciated

 

As for you comment on estate agent referring you to a solicitor they are more than likely doing this as the may have a deal with that solicitors for commission on referrals to that specific solicitors but you will never know about that.

 

What you can do with that solicitors is the following:

 

1. As that solicitors for the specific SRA number of those individuals dealing with your case and that they are registered with the SRA. You are fully entitled to ask this question and if it is a trainee their failures the buck stops with the main solicitor.

 

2. Are you aware that you can ask to see your file that those solicitors hold in their dealings with this and if not ask them to see their response.

 

Check that Solicitors website to see if they are registered member of other Bodies and if they are look them up to see specifically what their 'Code of Conduct' states and think to yourself have they followed that.

 

Also look up the solicitors on the SRA:

 

Solicitors Register

WWW.SRA.ORG.UK

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The Solicitors Register is a service for checking a solicitor or firm that is regulated by the Solicitors Regulation Authority.

 

Have you made a Formal Complaint to the Solicitors about their actions/inaction/conflicting information as you need to follow their complaints procedure. (if you haven't I would recommend that you do).