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F E Smith
F E Smith, Advocate
Category: Law
Satisfied Customers: 9032
Experience:  I have been practising for 30 years.
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We lessees of a 6-flat block feel that we are being overcharged

Customer Question

We lessees of a 6-flat block feel that we are being overcharged home insurance by Aviva and we have no option but use Aviva.
Can the Insurance Ombudsman help?
Submitted: 1 year ago.
Category: Law
Customer: replied 1 year ago.
(Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call. Let me know if you need more information, or send me the service offer(s) so we can proceed.
Customer: replied 1 year ago.
I have not received any answer to my question but have already paid £38 by PayPal.
So what is going on please??
Expert:  F E Smith replied 1 year ago.
It is estimated by the Royal Institute of Chartered Surveyors that up to 60% of landlords are overcharging and making profit on insurance, which they are not entitled to do.You have requested a telephone call. I am happy to call you but that is a Premium service which there is an extra cost. Here is the answer to your question. If you don’t want me to call, I will submit the Premium Service offer.This is not a matter for the Insurance Ombudsman. Is a matter for the Leasehold Valuation Tribunal. You are entitled to have a copy of the insurance policy at the premium receipt. Tell the landlord you want of the insurance policy that you are making the request under the Landlord and Tenant Act 85 schedule 2. They have actually got six months to let you have the information. You will then know whether they are loading the premiums being charged.They are not allowed to make a profit on the premium and the amount charged to the leaseholders total the amount of the premium. There may be hidden commissions that is a separate issue.The same Act, section 19 requires that all charges made to leaseholders are reasonable.To obtain some like-for-like quotes and if you find a reputable insurance company will do it for 20% less than the landlord’s policy go back to the landlord and request an adjustment under threat of going to the Leasehold Valuation Tribunal to challenge the reasonableness of the insurance premium.You can potentially claim back any overpayments going back 12 years.There is a word of warning here that is if you go to the Leasehold Valuation Tribunal and your claim is not successful, you would have to pay the tribunal costs. If your claim is successful though, the landlord would have to pay your tribunal costs.If all the leaseholders clubbed together it will spread the risk but if anyone doesn’t want to club in bringing the tribunal claim and the claim is successful they will still get the benefit.Can I clarify anything for you?Please do not forget to rate the service positively. It is an important part of the process.Best wishesFES
F E Smith, Advocate
Category: Law
Satisfied Customers: 9032
Experience: I have been practising for 30 years.
F E Smith and 2 other Law Specialists are ready to help you
Customer: replied 1 year ago.
Hi Mr Smith,
I delayed because I was awaiting the response of a more active lessee on the value of your answer.
Your answer does not of course fully resolve my query and I expect I will have to return to the service in some form. At the moment I am not sure how to proceed.
Eddie
Expert:  F E Smith replied 1 year ago.
If you can tell me what is still outstanding, I can deal with that specifically for you. There is not an easy solution if the management company or freeholder will not agree to use another insurer or revisit the premiums, it then comes down to the LVT.
Customer: replied 1 year ago.
The premiums differ arbitrarily. For example, one 1-bed flat in our block (South London) is charged £320, another identical flat £420. GoCompare company, on the other hand, charges just about £80. The difference is absurd and unfair.
Is there a way out of bypassing the landlord's preferred company (Aviva)? How can the lease be challenged for unfairness?
The First Tier Tribunal did not apparently object to our premiums and, furthermore, wouldn't allow application to a higher court.
Is there a way out of this unjust situation? In particular, how can we pressure the landlord to give us the option to choose our own insurance company? Please give us your considered opinion.
Expert:  F E Smith replied 1 year ago.
You had not told me that this had already been to the tribunal. Your only recourse would be to appeal the first-tier Tribunal and appeal the refusal to allow the appeal..You can only challenge on the basis that the charge is unfair and unreasonable and if the tribunal is already decided that it is not, apart from what I’ve already said, there is very little that can be done.Have you all considered purchasing the freehold?
Customer: replied 1 year ago.
I am sorry I don't find the answer of practical help. I am commenting again (with help from my colleague) and adding two files.:
Please find attached Tribunal documents (Original decision and Refusal of permission to appeal decision).The latter says - “...the respondent may make further application for permission to appeal to the Upper Tribunal” within 14 days. But to do that means further charges and generating a new set of documents and arguing against the First-tier’s “reason for the decision”. The First-tier is already signalling to the Upper Tribunal that there is “no new legal argument to support the application ..”Please ask the lawyer, following the above crooked result, what other court there is to appeal to and how to go about it. The application to the First-tier Tribunal is on the basis of excessive insurance premium. What are the chances of winning if we now complained the fact that clauses in our lease dealing with insurance has become unfair and unreasonable due to years of uncompetitive annual increases, resulting in excessive premiums compared to those of other companies on the open market.
Expert:  F E Smith replied 1 year ago.
I only have the first page of the decision which does not contain any of the meat of it. The general rule with regard to appeals is that you can only appeal if there is new evidence there the tribunal chairman has made an error of law or an error of fact. You cannot appeal simply because you don’t like the decision. Therefore, you are going to have to actually come up with the reason why the appeal decision was wrong.In your particular case, that would be that the finding that the insurance premium is reasonable was wrong because it is twice as much as you could get elsewhere from other insurance companies and that is supported by quotes from several other insurers, probably at least 3. That would be that the judge had made an error of law or an error of fact. However you are going to need to produce some evidence which supports the fact that these premiums you are being charged all unreasonable. To prove that you are going to need other quotes.There is always a risk that if an application fails, you would have to pay costs of the respondent.
Customer: replied 1 year ago.
Thank you for your views. I was surprised you received just one page.
To ensure you did not miss out any info, I am sending the two files again (in .jpg format).
So is there anything more you can add?
Expert:  F E Smith replied 1 year ago.
For some reason, I am getting is the first page. I have now had it three times. Can you please just send the second page in isolation? Thanks.
Customer: replied 1 year ago.
(Posted by JustAnswer at customer's request) Hello. I would like to request the following Expert Service(s) from you: Live Phone Call. Let me know if you need more information, or send me the service offer(s) so we can proceed.
Customer: replied 1 year ago.
more files to follow
Expert:  F E Smith replied 1 year ago.
I have more pages now and I can see the attachments containing the statutory provisions and the decision. However I have pages 1, 4, 5, 6 and 7 but not pages 2 or 3.Are you able to send just those two pages in isolation? Please do not send everything again.However you can only appeal the tribunal finding if the judge made an error of law or an error of fact and in this case, he made neither. The chairman judge made his decision based upon the evidence in front of him and it appears that the evidence you submitted was defective in that the quotations you sent were cheaper but they were not for exactly like for like insurance and therefore, he could not say whether the insurance being charged by Aviva was excessively expensive or not.What you would have to do is make an application to the tribunal to admit new evidence which would be quotations on an exactly like for like basis.
Customer: replied 1 year ago.
Thank you for the comments. Here is page 2 and 3:
Expert:  F E Smith replied 1 year ago.
Thank you. I did need to see those to see what was in them but I cannot add anything to my previous answer. Just one thing that you need to be aware of and that is that if the tribunal chairman or the respondent/defendant want this to be dealt with by hearing so that each of the parties can make submissions, there is a risk that the tribunal could award costs against the losing party and they could be substantial running into many thousands of pounds. It's always better if you try to do it without a hearing because it reduces costs dramatically.

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