As a Block Manager, or as part of a residential block management company, your working day will be busy, nuanced and will require you to spin multiple plates. As with any type of work where you interact with the public, move around from location to location, or where you are responsible for providing a service – it is not uncommon for mistakes to be made or accidents to happen. Making sure you and your clients have the right cover is imperative.
As well as ensuring your business is protected, it often falls to the block manager to arrange insurance for the building itself. Remembering always that you must be FCA regulated to advise on and arrange insurance, check out our essential guide to insurance and make sure you have the right cover in place.
Insurance for Block Managers
Types of insurance Block Managers will need to arrange for their Clients:
A major part of a role in block management is ensuring that the landlord gets value for money for their service charge payments, and the building is maintained in accordance with the terms of the lease. It is also common for them to be involved in arranging the insurance, either via an insurance broker or, if directly regulated by the FCA, via insurers. A Block Manager should be fully informed on:
Residential Buildings Insurance
If there is an insured event such as flood or fire and the block becomes damaged, buildings insurance can help minimise losses. It can pay for the repairs, including debris removal and any architects’ fees, or reinstatement. It can pay for alternative accommodation in the event a property becomes uninhabitable following a loss.
Ensure that your Buildings Sum Insured is adequate and remember that reinstatement valuations should be carried out at least every five years. These valuations will consider any changes or improvements made to the property since the level of cover was first set.
Directors and Officers Liability Insurance
Many blocks have a Right To Manage company set up to oversee management of the property. It’s important that Directors and Officers Liability insurance is strongly considered if this is the case. Taking out Directors and Officers Liability insurance provides defence costs and/or compensation for legal charges relating to a “wrongful act” in connection with property management. These could be:
- Breach of trust
- Breach of warranty
- Neglect
- Error
- Omission
- Misstatement
- Misleading statement
Different policies may contain different definitions so do read the small print. There will also be limitations and exclusions so speak to your specialist broker to ensure you are fully covered.
Engineering Insurance and Inspection
Most buildings insurance policies taken out on blocks of flats will cover damage to passenger lifts as a result of an insured peril such as fire, accidental damage and malicious damage. However, these policies do not normally extend to damage caused by the breakdown of the passenger lift or to the legal requirement to have lifts regularly inspected. A record of these inspections must be kept and/or a certificate issued.
Terrorism Insurance
Terrorism insurance provides cover for damage to the building following an act of terrorism. In some cases, terrorism cover is a requirement of the lease or mortgage provider. In 2014, a court ruling suggested that terrorism cover is a requirement for most flats, even when their location makes the risk of attack seem remote. While the likelihood of a terrorist incident is statistically low, the impact would be very high. Losses could be huge and being uninsured is too big a risk to take – not to mention unprofessional.
What insurance does a Block Manager need themselves?
Professional Indemnity for Block Managers
If you make a mistake, lose confidential documents or give advice that is deemed to be negligent, a client could file a claim against you. Block managers are responsible for the maintenance of a property so are likely to have a finger pointed at them in the event someone suffers an injury on the premises. Professional indemnity insurance covers any legal and compensation costs you are liable to pay.
Public Liability for Block Managers
Most of your working life is spent at other people’s properties so it’s important that you cover yourself in case you accidentally damage a client’s building. Public liability also covers you if a member of the public injures themselves while in your office. For example, if they fall on a slippery floor and break their ankle then they make a claim, this insurance would cover your costs.
Public liability can also cover the replacement of locks and keys to the properties on your books in the event of theft from your office, so you and your clients can sleep easy. Speak to one of our advisors to make sure you get the cover you need.
Employers’ Liability
This covers you if an employee gets injured or becomes ill because of the work they do for you. If they pursue legal action against your business, employers’ liability will cover the compensation.
Not all Policies are equal
The vitally important thing to remember is that policies are not all the same. The company offering the cheapest deal may not necessarily provide the level of cover you need. The only way to ensure you, your team, your buildings and your reputation are covered is to speak to an Eggar Forrester Insurance broker where we are dedicated to finding you bespoke cover.