Ansul fire system and insurance

[kelf]

HI,

Firstly may I thank anybody in advance for any input they may have.

My problem is this.

Earlier this year I set up a restaurant in North London having taken over a new lease from a previous restaurant. I did everything by the book. Got it rewired and replumbed and replace the old fire system. It was passed off by the building inspector and fire service for safety. The landlord had not carried out a risk assessment for a number of years. The landlord owns the building which has a number of other shops and offices.

I have opened the restaurant and have been running it. I was recently contacted by the landlord who stated that the insurer now wants an Ansul fire suppression system installing and expects me to meet the cost of this at several thousand pounds. I have spoken to both the building inspector and the fire service and both say I do not need this as I comply with regulations. The premises has been a restaurant for a number of year so it is not that I have changed the use.

The landlord is relying on part of the contract which states I have to comply with the requirements of the landlord's insurers. I have no problem with complying with the request - just feel that I should not be funding it. It is for the benefit of the landlord (as I cannot take it with me when I leave) or all of the tenants. The landlord is stating that ALL commercial policies in similar circumstances require a restaurant to have an Ansul system fitted and without it the building cannot be insured I have spoken to a commercial broker who says this is not the case.

I have a few questions

1. Has anybody else had a similar experience with an insurer and/or landlord insisting on an Ansul system?
2. I have spoken with an insurance broker who states that it is ridiculous to suggest that the building cannot be insured without it. Is this the case?
3. Has anybody had experience of dealing with a similar term of a contract where the landlord is relying on a clause that I have to comply with the requirements of their insurer?

Many thanks for any responses in advance.

 

[WaveJumper]

Welcome to the UKBF. In my mind a couple of things stand out here, you say you did everything by the book, did you not ask before signing the lease to see all copies of risk assessments covering fire, electrical and perhaps even asbestos. Did you submit your plans for refurbishment to the landlord for approval before commencing works, as at this point I would have expected the landlord to have taken advice on your plans and at this point had them run by his insurers in case there were any issues.

Obviously there are now, but I feel these should have been raised before works began andwere approved by landlord, at which point you could have argued the case with landlord and insurance company onsite. You are where you are, and apart from arguing your case with evidence from building control etc, perhaps even a meeting on site I feel unfortunately if the landlords insurers are insisting on this to continue cover for his building the bottom line is you are probably going to have to comply especially as you are required as mentioned within the lease.

 

[LPB 123]

Can you get your own quotes? Hopefully they won't need this requirement and then you can refer these back to the landlord.
Or could you ask them to get alternative quotes?

 

[IanSuth]

I wonder if it is related to this

"The landlord owns the building which has a number of other shops and offices"

Landlord is likely buying an insurance for the entire building - insurer is looking at possible total payout if your restaurant goes up in flames and takes out the other units so is saying the fire suppression system is needed. I bet they would insure without it but at a MUCH higher premium and the landlord knows he wouldn't be able to recoup that extra premium from the tenants

 

[kelf]

Hi,

Many thanks for your messages.

Waverider - you make a very good point that had not crossed my mind.

The landlord prepared the plans for the first system (as it was being totally renewed) and gave them to me!!! I walked them round the restaurant, told them what I wanted to do and their architect prepared the plans.They didn't ask for anything other than what was fitted. I have no idea as to whether they showed the plans to their insurers prior to me commencing the work. As regards looking at the fire risk assessment, I did not do this but I do not think it would have helped as this is the first mention of this system. I would guess the landlord did not show the plans to the insurer and have probably never heard of an Ansul system.

I have not got any specific quotes yet as I don't feel that I should be paying for the works. When I was first informed I did some research on the web and the systems start from several thousand and go up.

I understand how the insurers are looking at it but it has been a restaurant for a number of years (over 10 years) before I took it over and there was no requirement for the system then and the premium was a lot lower (discounting inflation etc) than they are seeking now I am told. Essentially the only change from last year is that the fire system has been renewed and updated.

 

[Frank the Insurance guy]

Hi @kelf - unfortunately is is becoming more and more common for insurers to insist on an Ansul system to be installed.

at this point I would have expected the landlord to have taken advice on your plans and at this point had them run by his insurers in case there were any issues.

Insurance requirements can change from year to year. Even if it had been agreed at the time, when the policy comes up for renewal, Insurers could have changed the requirements.

Can you get your own quotes? Hopefully they won't need this requirement and then you can refer these back to the landlord.
Or could you ask them to get alternative quotes?

Unfortunately, in my experience you cannot get your own quotes. The terms of the lease seem clear - you must comply with the landlords insurance requirements. There is no harm in asking the landlord to obtain alternative quotes to get cover without the requirement of an Ansul system, although I do not think they are obliged to do that.

Only thing I can think of is the "reasonableness" of the contract - it could be deemed an unfair contract of the landlord is insisting on certain measures without looking at alternatives.

I would suggest you contact the landlord and ask for evidence of alternative quotations and whether they require an Ansul System - the landlord may well tell you to get lost!

Note - Have you seen the full insurance policy endorsement/requirement for an Ansul system? This usually applies to larger industrial deep fat frying ranges only. If you only do a little deepfat frying, it may be cheaper to not use the industrial dryers, but use "table top" fryers (usually under 5litre capacity) as these are usually ok and do not require an Ansul system?

 

[Paul Kelly ICHYB]

Only thing I can think of is the "reasonableness" of the contract

That would be my approach, however, the lease terms appear explicit!