Block of Flats Insurance: A Guide for Freeholders and RMCs

What is block of flats insurance?

Block of flats insurance is buildings insurance specifically designed for properties containing multiple flats under one freehold, covering the structure of the whole building along with communal areas such as hallways, stairwells, lifts, roofs and shared gardens. It's distinct from the contents insurance that individual leaseholders or tenants arrange for their own flat.

Responsibility for arranging this cover usually sits with whoever owns the freehold, or with a resident management company (RMC) or Right to Manage (RTM) company where leaseholders collectively manage the building. The cost is typically recovered from leaseholders through the service charge, as set out in the terms of their lease.

Who is responsible for arranging it?

Most leases place the obligation to insure the building on the freeholder or landlord, who then recharges the premium to leaseholders via the service charge. Where leaseholders have exercised their Right to Manage, or where there's a resident-run management company, that body typically takes on responsibility for arranging buildings insurance instead.

It's important that whoever holds this responsibility understands their obligations under the lease, since leases often specify minimum requirements for the level and type of cover. Leaseholders themselves don't usually need to arrange buildings cover for their own flat, but should check their lease to confirm this and consider separate contents insurance for their own belongings.

What's typically covered

A block of flats policy generally covers the structure of the building, including roofs, external walls, foundations and windows, against risks such as fire, storm, flood, escape of water, and subsidence. It also typically covers shared areas such as entrance halls, staircases, lifts, bin stores and communal gardens.

Public liability cover is a key feature, protecting the freeholder or management company if someone is injured in a communal area, such as a slip on a stairwell. Many policies also include cover for loss of rent to the freeholder if flats become uninhabitable, employers' liability if the block employs staff such as a caretaker, and directors' and officers' liability for RMC or RTM company directors.

• Structure and communal areas (roofs, stairwells, lifts, gardens)
• Public liability for injuries in shared spaces
• Loss of rent if flats become uninhabitable
• Directors' and officers' liability for RMC/RTM committee members

What affects the price

Premiums for block of flats insurance depend on the number of flats, the age, height and construction of the building, the rebuild cost, and the presence of features like lifts or communal heating systems that add complexity. The building's claims history, fire safety measures, and any known issues such as cladding type can also significantly affect both availability and cost of cover.

In recent years, buildings with certain types of external cladding have faced more complex underwriting and, in some cases, higher premiums, reflecting increased insurer scrutiny of fire safety risk following well-publicised building safety issues. Freeholders and management companies with buildings affected by this should expect the quoting process to involve more detailed risk information than a straightforward block.

Tips for freeholders and management companies

Check your lease terms carefully to understand the minimum cover requirements and who the policy should protect, including leaseholders' interests where relevant. Keep records of any fire risk assessments, maintenance schedules and building safety certificates, as these are increasingly requested by insurers during underwriting.

When renewing or arranging cover, compare not just price but the insurer's experience with blocks of a similar size, age and construction, and check that the sum insured for rebuilding reflects current construction costs, which can change significantly over time.

How to get a quote

Blocks of flats often need individual underwriting given their size, construction and any building safety considerations, so a specialist broker can help find suitable cover. Complete the short form on this page and an FCA-authorised specialist broker will be in touch to discuss the block, with no obligation to proceed.

Frequently asked questions

Who is responsible for insuring a block of flats?

This is usually the freeholder, or a resident management company or Right to Manage company where leaseholders manage the building themselves, as set out in the lease.

Do leaseholders need their own buildings insurance?

Generally no, as the building is usually insured collectively by the freeholder or management company, but leaseholders should check their lease and consider contents insurance for their own flat.

Does block of flats insurance cover communal areas?

Yes, it typically covers shared spaces such as hallways, stairwells, lifts and communal gardens, alongside the main structure of the building.

Why might cladding affect my block's insurance?

Certain external cladding types have led insurers to apply more detailed risk assessment and, in some cases, higher premiums or more limited availability, due to increased fire safety concerns.

How is the cost of block insurance usually paid?

The premium is generally paid by the freeholder or management company and then recovered from leaseholders through the service charge.