Block Insurance Annual Review: Everything you need to know

Most of you will be aware that your block insurance is due round about this time every year. Over the years, we have formed an excellent relationship with our brokers (Marsh) and our insurers (Allianz) who we have found to provide excellent service and value.

Last year, our brokers conducted an extensive market analysis and found that, again, Allianz offered us the best deal in terms of service, policy cover and premium cost etc. by far. In order to obtain the best possible deal, last year we also entered into a two-year deal with premium increases capped at a maximum of five percent in year two.

In order to remain transparent and help you understand everything surrounding the block insurance annual review, we’ve set out a few of the key topics below.

Cost of Claims

This past year has seen a higher than average number of claims and a higher cost of claims performance, so we were pleased that we were protected by the capped increase. However, with the help of our broker, we managed to reduce this increase to an overall uplift of only 2.5% in our premium – half of what they were originally planning to apply. This limited increase has been secured with the following agreements:

• We enter another two-year deal with Allianz. We were happy to do this as Allianz have consistently offered the best overall deal.
• Escape of water excess level increase to £300 for most developments showing significant loss related to this. We agreed to this as the figures are well within industry standards.
• Allianz will cap next year’s premium increase to a maximum of 3%.
• The limit of liability cover for Property Owners Liability increases from 10,000,000 to 25,000,000 at no additional cost to our customers.
• We work with owners, insurers and brokers in an attempt to reduce the volume of private water claims.

In addition to the premium review, we must also look at the sum insured or declared value on an annual basis to ensure that your development is sufficiently insured. This year, we have agreed a very modest 1.5% index linked increase in declared values. This will not affect those developments, managed from our Edinburgh office, that have just completed their five yearly revaluation surveys.

Although we were able to significantly restrict the percentage increase in premium this year, we can’t get away from the fact that it was influenced by the cost of claims. To ensure fairness throughout our portfolio, we have worked with our brokers and applied varying premium reviews dependent on claims. This means that those developments whose claims cost was particularly high last year will have a greater percentage increase applied than those whose claims have been low or nil. We do consider this to be the fairest way to spread the increased premium cost.

Our commission rates are unchanged from last year and these can be viewed on your Development Schedule in your online portal. If you do not know how to access your portal, please contact your local post office for guidance. If you cannot access our portal, we will be pleased to issue a hard copy on request.

Your new insurance schedule is also ready and has been uploaded to your portal. A copy is available from your local office if required.

We are delighted that we have secured such a good deal for our customers once again this year. We would also like to remind everyone, however, that of the need to ensure good maintenance within the home (bath and shower seals, washing machine hose connectors, overflows etc.) in order that the volume of preventable claims can be minimised.

We hope this information helps you to understand the annual insurance review better.

If you’d like to find out more about block insurance, you can contact your relevant office at Glasgow here, Edinburgh here, or Aberdeen here.