WE URGE ALL LEASEHOLDERS TO USE THIS WEEKEND TO COMPLETE THE CONSULTATION. WE MUST MAKE OUR VOICES COUNT.
The government are seeking views on proposals to prevent freeholders, property managing agents and landlords from imposing on leaseholders opaque and excessive charges related to building insurance, often in the form of commissions calculated using a percentage of the insurance premium. The government has evidence this model can lead to managing agents and freeholders selecting more expensive insurance policies than is necessary.
Instead, they would only be able to charge a fair and transparent permitted insurance fee to leaseholders.
Leaseholders will be paying these ‘Permitted fees’ and therefore, leaseholders MUST have their say.
The government are proposing to ban insurance payments being charged to leaseholders – WITH THE EXCEPTION OF THE PERMITTED FEE.
No doubt leaseholders will be worried about what will be as included as a ‘Permitted fee’ and question if this is just dressing ANOTHER unjustified fee up under a different name.
The permitted insurance fee will form part of the variable service charge, which means that leaseholders may challenge its reasonableness under the provisions of the Landlord and Tenant Act 1985.
This consultation seeks views on what the parameters should be of this permitted insurance fee charged by freeholders and property managing agents to leaseholders. The criteria of this permitted insurance fee will be set out in secondary legislation.
The government want to understand as part of this consultation what examples of current payments to freeholders and property managing agents are taking place. This is why we MUST provide them with the evidence we have of rip-off fees. You may also find the background document here helpful before you respond.
IT’S IMPORTANT LEASEHOLDERS HAVE THEIR SAY AS LEASEHOLDERS WILL BE THE ONES PAYING THESE PERMITTED INSURANCE FEES.
The Leasehold Knowledge Partnership have produced some guidance below. The most important point is you respond to this consultation.
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