Block of Flats Buildings Insurance

What a block buildings policy insures

• External walls, foundations, roof, floors and structural elements.
• Fixed internal fabric of each flat — plaster, fitted kitchens, bathrooms and fixed flooring, subject to the wording.
• Communal hallways, stairwells, lifts, entrance systems and bin stores.
• Outbuildings, garages, car parks, boundary walls, gates and fences within the demise.
• Underground services and communal plant such as boilers and pumps.
• Property owners' liability and, where relevant, employers' liability for on-site staff.
• Loss of rent, service charge and alternative accommodation after an insured event.

Setting the rebuild sum insured

The rebuild sum insured is the most important number on a block policy and the most commonly wrong. It is not market value — it is the cost of putting the building back up from a cleared site.

If the sum insured is too low, insurers may apply average and reduce a claim payment proportionately, which matters particularly for RTM and RMC directors accountable to leaseholders for the adequacy of cover.

• Demolition, debris removal and site clearance.
• Rebuild to current building regulations, which is often more expensive than the original build.
• Architects', surveyors' and other professional fees.
• VAT where recoverable rules do not apply.
• Index linking between renewals, plus a formal reassessment every few years.

Where the block policy stops and leaseholder cover starts

• Block policy — structure, communal areas, shared plant, liability and loss of rent.
• Leaseholder contents — furniture, electronics, clothing, valuables and, in some wordings, carpets.
• Landlord cover for a let flat — contents supplied to tenants, loss of rent, landlord liability and legal expenses.

Common exclusions to check

• Unoccupied flats beyond a stated period, often 30 to 60 days, without notifying insurers.
• Gradual damage, wear and tear, and defective workmanship.
• Terrorism, unless purchased as an extension.
• Damage arising from known unremediated cladding or fire safety defects.
• Subsidence excesses, which are typically higher than other perils.

Frequently asked questions

What is block of flats buildings insurance?

It is a buildings-only policy covering the whole structure of an apartment building — external walls, roof, floors, communal areas and the fabric of each flat — plus property owners' liability and loss of rent. Leaseholders' possessions are not covered; they need their own contents insurance.

Does buildings insurance for flats cover the inside of each flat?

Most block wordings cover the fixed fabric inside each flat — walls, ceilings, floors, fitted kitchens and bathrooms — but not furniture, carpets in some wordings, or personal belongings. The lease and the policy schedule confirm exactly where the boundary sits.

How is the rebuild sum insured calculated for a block?

It is the cost of demolishing and rebuilding the entire block to current building regulations, including site clearance, professional fees and VAT. It is not the market value of the flats. Most insurers expect a formal rebuild cost assessment for larger blocks and periodic revaluation.

Does a block buildings policy include liability cover?

Property owners' liability is normally included as standard, commonly £2m to £10m, covering injury to residents, visitors or contractors and damage to third-party property arising from ownership of the building.

Is escape of water covered?

Escape of water is standard on most block wordings and is the most frequent cause of claims in flats. Insurers often apply a higher excess for it, and blocks with repeated leaks can see terms restricted at renewal.

Do leaseholders still need their own insurance?

Yes. The block policy covers the building; leaseholders need contents insurance for their possessions, and leaseholders who let their flat should consider landlord cover for contents, loss of rent and liability.