The buildings insurance covers damage to the leasehold buildings (36 flats in total). Please note that this insurance does NOT include cover for residents' contents.
The insurance policy sets out the details of the buildings insurance contract.
The Upper Tribunal (Lands Chamber) considered the necessity for terrorism insurance in the case of Qdime Ltd and (1) Bath Building (Swindon) Management Company Ltd (2) Various leaseholders.
The property is a purpose built block of flats insured by Qdime Ltd, the freeholder (referred to as the Landlord) in accordance with the Landlord’s lease covenants. The lease obliged the Landlord to insure the building against “.. the usual comprehensive risks in accordance with the CML recommendations … from time to time”.
The Upper Chamber determined on the basis that one of the defined perils in the CML recommendations (Council of Mortgage Lenders Handbook section 6.14.2) includes explosion and that insurance should be provided against an event, not any particular method, causing the event. Therefore terrorism insurance was required.
Terrorism Insurance Documents
Cover has been provided under a separate policy from 2016
Directors & Officers Insurance
The D & O Policy is designed to protect leaseholders who volunteer their services as directors of the management company.
People appointed as Directors and Officers hold positions of trust. They will be liable for any act, which is negligent, outside their authority, or in breach of their own responsibilities. Directors and Officers should be aware that they can be personally liable for their acts and without insurance are effectively risking their personal wealth and the future of the company, since the financial implications of a legal action can be disastrous.
The residents in their capacity of a Director or Officer face numerous duties and responsibilities, even if the services of a managing agent are employed, some of which are defined in law. These responsibilities include the need to ensure that:
• The property is safe and Health & Safety legislation is complied with.
• Any contractors used to carry out maintenance at the property, do so properly
• The finances are in order as the resident can be held personally liable for the debts of a company if “he knew or ought to have known that there was no reasonable prospect that the company would avoid going into insolvent liquidation”.
The law does not distinguish between the director of a residents management company and that of a major corporation. Ignorance of the law is no defence, so it is important for any resident wishing to take a position of responsibility, to know the liabilities that they face. Especially as these liabilities may be unlimited.
Types of Exposures
• Health & Safety – fire safety, electrical and mechanical equipment checks
• Insolvency Act
• Companies Act 2006
• Disability , racial and sexual discrimination
• Dishonesty to fellow directors
• Failure to supervise
• Failure to appoint bona fide contractors
• Defamation (libel & slander)
Due to the above exposures D&O cover is needed to insure the directors and officers of the Residents Management Company against any claims made against them.
Directors and Officers Insurance Documents
Directors and Officers Policy Documents
Following an insured loss a claim should be submitted to the insurance agent by "the claimant".
If the loss is to the communal areas the claimant will be the management company.
If the loss is to an individual flat the claimant will be the leaseholder.
The insurance agent will direct the claim to the insurance company which will often appoint a claims negotiator/loss adjuster to deal with the claim on its behalf.
The claimant will usually be requested to submit two quotations for repairs/replacements and following agreement by the insurers, contract for the repairs/replacements.
Once the repairs etc are complete the claimant should pay the invoices and submit the receipts and invoices to the insurers for repayment. It is possible that the insurers may pay the invoices direct but they are under no obligation to do so.
Should there be a deductible excess, this amount will be deducted by the insurers before the claim is settled. Where the damage was caused by a Third Party the claimant should recover the excess sum from the Third Party.
N.B. Please refer to the Policy document for full details of cover and claims procedure.