Question 1

Unfair excess charges?

Accepted Answer

We have recently had water seeping through the ceiling from one flat into a lower one. Because there was quite a bit of damage to walls and floors etc. the owner of the higher flat claimed against our building insurance. The excess at the time was £500. We have had 22 claims against the insurance company in 23 years regarding water damage due to poor plumbing. However the insurance company insisted that both the upper and the lower flat pay half of the excess amounting to £250 each. This seems totally unfair as it was not the fault of the lower flat. Is the insurance company correct in asking both flats to pay half of the excess? You do hold a copy of my deeds. The FPRA replies: Your question has been passed to me as I am a retired insurance broker who volunteers to help members on insurance questions and my previous company has over 1000 blocks of flats insured so I have some relevant experience. I am not a legal adviser, I have not read your lease which we do have on file so I am answering purely from an insurance prospective and from the prospective of my own residents association, I am assuming that there is nothing in your lease or other regulations that specifies exactly how this is dealt with. I would agree this does seem very unfair however, unless there is some indication that the upstairs flat has in some way been negligent I am not certain what other way it could be dealt with. As you refer to a large number relating to the plumbing in the building as a whole so it seems unlikely that it is the upstairs flats negligence that might have caused the problem. I am assuming that you do not treat the policy excess as a service charge matter which is then of course divided by all the flats in your block. With so many claims from presumably the same fundamental cause I wonder whether you ought to be looking at some preventative measures as this must be impacting on your premium levels. In my own block we are going through the painful and expensive process of replacing 1930’s lead pipes and tanks entrance by entrance at a cost of over £1000 per flat, because we could not stand the continuation of on-going water claims from that source.

Question 2

Unfair excess charges?

Accepted Answer

We have recently had water seeping through the ceiling from one flat into a lower one. Because there was quite a bit of damage to walls and floors etc. the owner of the higher flat claimed against our building insurance. The excess at the time was £500. We have had 22 claims against the insurance company in 23 years regarding water damage due to poor plumbing. However the insurance company insisted that both the upper and the lower flat pay half of the excess amounting to £250 each. This seems totally unfair as it was not the fault of the lower flat. Is the insurance company correct in asking both flats to pay half of the excess? You do hold a copy of my deeds. The FPRA replies: Your question has been passed to me as I am a retired insurance broker who volunteers to help members on insurance questions and my previous company has over 1000 blocks of flats insured so I have some relevant experience. I am not a legal adviser, I have not read your lease which we do have on file so I am answering purely from an insurance prospective and from the prospective of my own residents association, I am assuming that there is nothing in your lease or other regulations that specifies exactly how this is dealt with. I would agree this does seem very unfair however, unless there is some indication that the upstairs flat has in some way been negligent I am not certain what other way it could be dealt with. As you refer to a large number relating to the plumbing in the building as a whole so it seems unlikely that it is the upstairs flats negligence that might have caused the problem. I am assuming that you do not treat the policy excess as a service charge matter which is then of course divided by all the flats in your block. With so many claims from presumably the same fundamental cause I wonder whether you ought to be looking at some preventative measures as this must be impacting on your premium levels. In my own block we are going through the painful and expensive process of replacing 1930’s lead pipes and tanks entrance by entrance at a cost of over £1000 per flat, because we could not stand the continuation of on-going water claims from that source.

Unfair excess charges?

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Rebecca Paul MP

FoPRA

Free Leaseholders