Landlord charges for Building insurance

[Jixpix]

Hi, this is going to be fairly long winded but PLEASE stay with me - I hope someone can help!
issue 1
I have a small retail shop, my landlord charges me an annual premium for Building insurance. The lease states a "Fair Proportion" but as I have never had any copy documentation for the insurance whatsoever I am unable to see what percentage of the whole I'm paying. Do I have a right to ask for a copy of the schedule or policy or anything?
issue 2
She has a multi property policy and last year made a claim for flood damage to one of her other properties - I had a large increase on my premium to cover "my share" as she put it!
issue 3
I've asked other retailers in my street what their premiums are and I seem to be paying over the odds - £805 last year, it's a retail shop selling art and craft materials with a rateable value of £10,250 so not huge!

I have asked the Federation of Small Businesses for advice which was less than useless, (am no longer renewing that!), then sought private legal advice - the solicitor was horrified not only at the foregoing but at the total amount I am being charged - only downside was that he wanted £300 per hour which at the moment I just can't justify or afford.

The premium is due for renewal again now and I'm sure it's going to be yet another issue - ANY advice would be really appreciated!

Regard Janine

 

[kulture]

What does your lease say? Unless it has a clause in there that permits you to get involved with the negotiation of insurance premiums then there is no legal way out. You have to pay the buildings insurance as set out in your lease.

HOWEVER when you negotiated your lease, your solicitor should have tried to put some protection in there for you. There should be a formula defining how the insurance costs are split between properties, there should be a clause allowing you to get a copy of documents and there should be a clause allowing you to see the receipts of insurance paid. If there is not then you should go see the original solicitor who advised you when you took out your lease and suggest they fix this at their expense.

You could talk to a local insurance broker and see if you can get a quote for insurance which is much cheaper and suggest to your landlord that she switches to this broker and save you all money. Who knows, it might work!

 

[Jixpix]

Hi Kulture,
Many thanks for the response, will try going back to original solicitor but do not hold out much hope.
I need to get hold of the schedule at least so that I can get competitive quotes based on like for like.

Thanks for your help
Janine

 

[deniser]

Up to 50% of your premium may be commission to the landlord with nothing you can do about it.

It is very difficult to do anything about it retrospectively but there is no harm in trying as Kulture suggests.

 

[lockyer]

Unfortunately the post above is right, a large number of landlords, particularly the smaller ones, tend to demand "earn backs" off the insurarnce premiums, which get built into the overall premium. Which in turn get paid by the tennant.

Things you need to take into consideration though. The Landlord wants to protect his investment, so he will buy the widest cover possible, and with the most secure insurers. Price rarely comes into it.

It is very rare that a landlord is relaxed enough to let a tenant arramnge the insurance themselves, especially in a recession, as if the tennant failed to pay the premium it would leave his investment unprotected.

You don't indicate the rebuild sum insured of the property, but as a rule of thumb a retail premises should cost no more than £1000 per £1m sum insured.

If you want to discuss this matter in confidence, or get a comparative quote, feel free to get in touch.