You are here: Home - News -

Michael Gove asks FCA to investigate buildings insurance market for high-rise leaseholders

  • 28/01/2022
  • 0
Michael Gove asks FCA to investigate buildings insurance market for high-rise leaseholders
Secretary of state for Levelling Up, Housing and Communities Michael Gove has written to the Financial Conduct Authority (FCA) to review the buildings insurance market for multiple-occupancy residential buildings, in cooperation with the Competition and Markets Authority.


Gove said he had been “extremely concerned” to hear of the pressure that leaseholders faced from rapidly escalating building insurance premiums on high and medium-rise blocks of flats. 

He asked for the review to shed light on the underlying causes of annual increases and assess the causes of the “marked restriction” in coverage available for multiple-occupancy buildings. 

Gove wrote: “I have been particularly concerned to hear of cases where insurance premiums have escalated by over 100 per cent year-on-year, leaving residents with crippling costs. It is clear to me that the insurance market is failing some leaseholders.” 

He said there had been progress in the removal of unsafe cladding and insisted there was work to ensure that “the small amount of dangerous cladding that remains is removed” and paid for by the industry. 

He added: “Despite this progress and the continuing decrease in the instances of fire in multiple-occupancy buildings, building insurance premiums have increased dramatically for almost all leaseholders in blocks of flats.  

“I am also concerned to hear that many insurers seem unwilling to offer new policies, forcing people to shop in a more limited marketplace with more restrictive terms or less coverage; in many cases, trapping people with their current provider.” 

Gove said the market lacked transparency and said there was no “useful data” to explain rising premiums. 

He also said the role and remuneration of brokers, managing agents and freeholders was also unclear.  

“My overall goal is for there to be a more affordable marketplace for buildings insurance that offers widely available and affordable cover for those who live in flats and other multiple-occupancy buildings,” he added. 

Gove has asked for feedback within three months, and a final report within six months. 

There are 0 Comment(s)

You may also be interested in