While building insurance may not be the most exciting subject, it is a crucial and often costly part of the service charge budget.
Here at Strangford Management we frequently receive requests for tips and tricks to lower building insurance premiums. This inspired us to compile a list of strategies that property managers and resident management companies/leaseholders can use to reduce and manage building insurance costs:
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Shop Around – It’s essential to obtain multiple quotes to ensure you’re getting the best deal. Make sure your property manager or the person responsible for insurance secures at least three separate quotes. Leverage the vast insurance market to your benefit.
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Find the True Value – When starting to manage a property, we always recommend a full insurance valuation if one hasn’t been done recently. Proper insurance coverage minimises financial risk for policyholders. The last thing you want is to discover you’re underinsured when a claim is made. You might be surprised by the results.
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Increase Your Excess – Common risks covered by building insurance include water damage, fire/lightning, explosion, subsidence, and accidental damage. If claims are frequent, consider discussing the option of raising the insurance excess with your provider. This can lower your overall premium and discourage frequent claims.
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Be Proactive – Building insurance becomes a hot topic when claims are frequent, often due to water leaks. Implementing a proactive maintenance plan can help prevent issues from arising. While increased claims may already have driven up premiums, being proactive can help reduce costs over time.
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Payment Method – Most property managers can arrange credit for their clients, allowing premiums to be paid monthly. However, this can increase your annual cost by up to 10% in some cases. It’s financially wise to manage the service charge accurately to pay for building insurance in a single annual payment.
Strangford Management has access to the entire market, providing our clients with the best insurance policy for the year ahead.
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