Dilapidations North-West: Warning- Buildings Insurance Conditions for Landlords

It is usual in most Full Repairing and Insuring FRI lease provisions for Landlord to insure the building and charge back the premium to the Tenant. The Tenant is obliged not to do anything by action or inaction that might void the insurance policy.

How many Landlords actually send a copy of the policy to the Tenant and draw attention in writing to the insurance company’s specific requirements and contractual terms with which the Tenant should comply; have you?

Recently ,whitest reviewing a lease during the term with regard to interim inspection and preparation or schedule of dilapidations, this matter came up. I reminded the Landlord of the above, which he had not done.

Lo and behold he discovered his insurance policy expressly required annual inspection ( and record of such inspection by roofing contractor) of all flat roofs. Further such record had to submitted annually to the insurers.

The Tenant could not reasonably have been required to comply if he had no constructive knowledge of such requirement by the insurer.

Many insurers are now including express provisions on buildings and engineering services maintenance. Why should they underwrite neglect to good housekeeping?

Always check the policy wording. Remember the loss adjustor in the event of claim works for the insurance company and not you.

<WoW (Words of Wisdom)

Send copy of lease to your Tenant, draw attention to specific conditions of such policy and require Tenant to provide evidence of compliance periodically, otherwise run risk of the policy being void by breach of insurance contract condition. Instruct periodic inspections by your Building Surveyor.

 

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