Please Note: This Article is 7 years old. This increases the likelihood that some or all of it's content is now outdated.

With UK yields booming according to global property consultancy Knight Frank and overnight off-plan sales of blocks like Manchester’s Tower 2  in Media City  it seems that buy-to-let is still booming in the leasehold flats market.

This can have big implications for its management if sub-tenants are not made fully aware of all the lease covenants, for example noise, storage of bikes and drying washing on balconies.  Problems can also arise with insurance because provided by the buildings insurance. tenants of sub-let and buy-to-let flats may be excluded from some of the protection

“In a block of flats, buildings insurance is arranged by the freeholder, the residents association or a managing agent acting on their behalf.  So if you plan to sub-let your flat, assuming the lease allows it, make sure that whoever is responsible for placing insurance is aware and can advise the insurers,” says Nigel Feast, managing director of specialist blocks of flats insurance broker Deacon.

“Usually, insurers have no problems with these arrangements, as long as they are told about it before any claims arise and a formal agreement — usually an Assured Shorthold Tenancy (AST) agreement — is in place between the leaseholder of the flat and the tenant.”

However, there may be exclusions, such as not covering the costs of alternative accommodation for tenants if the flat become uninhabitable.  In such a case, the occupants may simply quit the tenancy, leaving the owner out of pocket and with the expense of finding a new tenant.

“At Deacon our policies usually extend this cover to tenants but, as ever, the best advice is to pick up the phone and talk to your insurer, “ advises Deacon MD Nigel Feast.

According to the latest English Housing Survey (2013-14) 19% or 4.4 million households live in privately rented accommodation, up from 11% in 2003.

Find out more about Deacon at

About Deacon: Founded 25 years ago, Deacon specialises in blocks of flats insurance, providing a comprehensive in-house quote, administration and claims handling service.  It has always been an innovator, persuading insurers to include many extra standard features that are especially relevant for leasehold property, such as the cost of tracing the cause of incidents like leaks that typically affect more than one flat. These initiatives have been widely adopted and now benefit the blocks of flats market as a whole.

About Arthur J. Gallagher: Arthur J. Gallagher is the brand name for the international broking division of Arthur J. Gallagher & Co. trading outside the United States.  It employs more than 6800 staff across the UK, Australia, Singapore, Caribbean, Canada, Chile, Norway and New Zealand.  Arthur J. Gallagher & Co. (NYSE: AJG), an international insurance brokerage and risk management services firm, is headquartered in Itasca, Illinois.  It operates in 30 countries and offers client service capabilities in more than 140 countries around the world through a network of correspondent brokers and consultants.

Please Note: This Article is 7 years old. This increases the likelihood that some or all of it's content is now outdated.


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