It is probably impossible to overstate the importance of fire risk assessments, health and safety audits and understanding the fabric of a building to reduce the risks to occupants and visitors.

However, from an insurance perspective, risk management also means taking positive steps to reduce the likelihood of claims arising. Failure to identify factors that can lead to insurance losses might be seen as having contributed to the loss, and any claim pay-out could be reduced accordingly. Insurance is protection against unforeseen losses: it is not a replacement for good maintenance.

Statutory risk assessments and personal safety

The duty to comply with the regulations falls on the landlord (freeholder) or person responsible for the management of the building, which could be an agent or the directors of a resident management company or a right to manage company.

Whether these costs can be passed on to leaseholders by the freeholder or other responsible person depends on the terms of the lease, in particular what it says about service charges. However, more modern leases will include an obligation, with a right to recover the costs from leaseholders. This includes any formal risk assessment AND the costs of remedial work.

Risk Assessment of Communal Areas: All blocks of flats must have an annual risk assessment carried out on the health and safety of any common areas. It is a requirement of the Management of Health and Safety at Work Regulations 1999. Remember, communal areas of blocks of flats are considered to be commercial premises and, even if there never any employees of the landlord working at the block – cleaners, gardeners, managing agents etc – it is still best practice to assess risk. If there was an accident to a resident or visitor and you had no proof of a risk assessment being carried out, and remedial action having been taken, you are much more likely to be prosecuted and/or sued for negligence.

Fire Safety: Under the Regulatory Reform (Fire Safety) Order 2005 every block of flats must have a fire safety risk assessment with a nominated Responsible Person ensuring the assessment is done and necessary actions taken. .

Fire Officers can enter any block of flats to inspect, ask to see the risk assessment and issue enforcement notices to improve fire safety should the need arise.

The new Fire Safety Act 2021 , which applies to England and Wales amended the Fire Safety Order 2005 (“the 2005 Order”) as part of the government response to the  Grenfell Tower Inquiry.

This new legislation clarifies that, for any building containing two or more flats, the 2005 Order applies to the building’s structure and external walls and any common parts, to the entrance doors to individual flats opening into common parts, and to any doors or windows in external walls and anything attached to the exterior of those walls (including balconies).

Government guidance on fire safety in purpose built blocks is  available HERE (this document is under review with an updated version due to be published in early 2022.

Working at Heights: Work at height can include changing light bulbs, general cleaning, testing smoke detectors and cleaning gutter as well as window cleaners. If any of these apply, then an assessment of the risk from working at height is required. The underlying goal is that any work at height should be avoided if possible. If not, then work must be planned, and equipment such as ladders maintained, to minimise risk.

Electrical Equipment Safety: If electrical equipment is supplied by the landlord or agent to say a cleaner, then it must be regularly tested and properly maintained. You should consult a qualified electrical contractor. 

Legionella: The landlord or agent of a block of flats has a duty to control the risks of legionella in any pipes, tanks and taps in common parts (including a cleaner’s cupboard). Specialist contractors should be consulted. 

The Health & Safety Executive provides a useful template for risk assessments in blocks of flats.

Insurance risk assessments

Naturally, insurers will expect that you comply with statutory requirements as outlined above and keep the property in good condition.

In practice, assessing risks not covered by statutory requirements will probably come under the umbrella of planned maintenance and good management.   Some aspects of it may be defined in the lease anyway, such as how often interior and exterior decoration is required.

Should lack of maintenance contribute to a loss, such as falling roof tiles after decades of neglect, leaks through windows that have not been checked for years, or falling branches from trees left unpruned, then an insurers’ loss adjuster must take into consideration the general state of the building.  As a result, insurance pay-outs may be reduced in proportion.

Sometimes, insurers provide cover subject to an insurance inspection, and it can be months before an inspection is made, if at all. However, you will have been asked, and will have answered, questions about the general condition of the building and should have answered honestly.

If you undertake periodical revaluation of the building, then the qualified surveyor undertaking it will be able to flag up any obvious issues.  You can read more about our valuation services here .

7 February 2022 (FP1295-2021)

The sole purpose of this article is to provide guidance on the issues covered. This article is not intended to give legal advice, and, accordingly, it should not be relied upon. It should not be regarded as a comprehensive statement of the law and/or market practice in this area. We make no claims as to the completeness or accuracy of the information contained herein or in the links which were live at the date of publication. You should not act upon (or should refrain from acting upon) information in this publication without first seeking specific legal and/or specialist advice. Arthur J. Gallagher Insurance Brokers Limited trading as Deacon accepts no liability for any inaccuracy, omission or mistake in this publication, nor will we be responsible for any loss, which may be suffered because of any person relying on the information contained herein.