14% of Britons dwell in flats, 43% of which are Londoners. Flats are easier to maintain, cheaper to buy or rent, and dominate the housing stock in vibrant urban areas making them a convenient choice for everyone from young professionals to seniors. And flat-dwellers aren't all renting. Many have purchased their flats: in 2018, 18.5% of sold properties were flats.
But whether you're an owner-occupier, landlord or tenant, you'll want to insure your flat and the possessions kept within it. In many cases, including if you only own the leasehold or are just a tenant of the flat, you'll only need to have contents cover and can skip buildings insurance. Our guide takes you through all things insurance for your flat.
In This Guide:
- Do you need buildings insurance for your flat?
- Insuring the flat if you own part of the freehold
- Do you need contents insurance for your flat?
Do you need buildings insurance for your flat?
Home buildings insurance covers the physical structure and permanent fixtures of a residence—including its roof, floor, walls, windows, doors, bathroom and kitchen fittings. In many cases, you won't need to obtain buildings insurance for a flat.
For instance, if you own the leasehold of a flat, with the block and the freehold owned by a company or local authority, that entity should hold insurance for the building. You'll likely pay the premiums for this insurance cover through your service charge. In addition to the service charge, you may also be directly liable for a portion of the costs of repairing the roof or communal areas. Your lease will spell out your responsibilities.
However, if you have a mortgage on the flat, your lender may require you hold buildings insurance for your particular portion of the building.
If you're renting a flat, as with renting a home, you're not responsible for insuring the building. Buildings insurance will be provided by the owner of the freehold—who may be your direct landlord or may be the owner of the block.
However, if, as an owner-occupier or landlord of a flat, you own part of the freehold of the building, you will need to take out buildings insurance.
Insuring the flat if you own part of the freehold
In recent years, many leaseholders have banded together to purchase all or part of the freehold of the building their flats are in. Owning the freehold gives you more control over the property but does leave you responsible for its repair, meaning you'll need to take out a buildings insurance policy.
Sometimes freeholders take out individual policies covering their portion of the freehold. But it may be cheaper and simpler to take out one policy for the block or building, covering everyone. Owning the freehold and being responsible for its insurance gives flat owners incentive to shop around for a cheaper buildings insurance policy than the one a freehold-owning company might use, saving everyone money.
Do you need contents insurance for your flat?
Owner-occupiers of flats will want to insure the possessions they keep within it with contents home insurance policies. Additionally, tenants of flats will also want to take out contents cover; any home insurance policy held by their landlord won't cover their belongings.
Obtaining cover might be more complicated if you live in a rented flatshare. Insurers might be concerned about theft or damage due to your flatmates or anyone they let into the building. Therefore you might need to obtain a contents insurance policy that covers just your room, provided you keep it locked.
Additionally, tenants in flats might want to obtain tenants insurance, which bundles contents cover with tenants' liability insurance, covering you for fixtures and landlord-provided items you may accidentally damage in your rented accommodation.
Landlords of rented flats may also want to consider taking out a contents insurance policy, to cover the furniture and appliances they provide with the property, which can be very expensive to replace.
Landlords insurance packages contents cover and any buildings cover required with insurance that addresses the other risks and liabilities of renting out a property. This can include protection against damage or theft caused by tenants, tenant default insurance (protecting you if the tenant doesn't pay rent for several consecutive months), and rental protection insurance (reimbursing you for lost rent if the home is made uninhabitable by an insured event).
Money Expert can help you compare home insurance quotes from over 50 providers so you can find the best cover and price for your flat.