Block insurance for Apartments

[emgee]

Nigel

One of our residents has been told by a major insurance company that as from 1 Jan 2010,
ALL individual apartments in an apartment block(s) have to be insured for fire, earthquake, etc with a single insurer. Apparently, this is the practice in UK at the moment and EU legislation demands that it come into force throughout the EU.

Have you heard of this proposed legislation?

Alan

[Nigel Howarth]

I've not heard of this Alan, I'll look into it.

Regards,

[Ruthie]

Hi, Alan.
I haven't heard about this, either. I arranged insurance cover for our communal areas in September, with a large insurer in Cyprus, and at the time, discussed the possibility of all of the 12 flats within our block having insurance with them also, for their individual cover. Nothing was mentioned at all regarding any legislation coming into effect in respect of everyone having to have the same insurer however - I can't see how individuals can be forced into that, really. As the agent pointed out, insurance companies do prefer to have everyone in a complex under their individual 'wing', because it saves any possible arguments amongst different companies in the event of a claim being made where more than one property is affected, but several insurers are involved. I have noticed when reading various insurance companies' literature, that they do seem very keen to emphasise the benefits of this - well they would if it brings in more money and makes life easier for them, wouldn't they!

As an aside, but still on the subject of insurance, I was stunned to be told that it is estimated that 85% of Cypriots do not have Buildings or Contents insurance, as they do not feel it is a priority. Given that, it would probably prove to be rather difficult to convince a 'local' within a complex, to come on board with everyone, with the same, or any insurer, I would think. Is it just the British who are paranoid about having/not having insurance cover?!

Regards.

Ruthie

[Nigel Howarth]

Hi Alan,

As far as I can see, there is no requirement to have all the flats in a building insured through the same insurer. After a bit of searching on the web, I came across http://www.assetsure.com/blocks-flats-c.htm - it's worth a read.

As Ruthie says, it will be easier if there was only one insurance company involved - any could possibly be more cost-effective, but as far as I can see there's no requirement for all the flats to be insured through the same company.

And you may well be right Ruthie about Cypriots not having insurance cover - I recall a case a couple of years ago where a jewellery shop in Limassol was robbed - the owner had no insurance. And from some of the scenes I saw earlier this evening about the floods in the Alambra area outside Nicosia, I would guess many people don't have insurance.

Regards,

[emgee]

Dear Ruthie

We tend to agree 100% with your observations and are going to write to our interested party (4 out of 24) saying that unless we have specific information then we, the Committee will not proceed with this subject.

Most of us have car, house contents, building and medical insurance with the same insurer and enjoy cheaper insurance as a result.

How are we going to convince everyone to change insurance companies, as you say the Cypriots may not have any insurance anyway?

Thanks for your response.

Alan

[Nigel Howarth]

One of our residents has been told by a major insurance company that as from 1 Jan 2010, ALL individual apartments in an apartment block(s) have to be insured for fire, earthquake, etc with a single insurer. Apparently, this is the practice in UK at the moment and EU legislation demands that it come into force throughout the EU.

Alan, I was in touch earlier today with a guy in the insurance business. What you insurance company has told you is a pack of lies. Does their name begin with the letter 'A' by any chance?

Regards,

[emgee]

Nigel

Yes! the company name does start with the letter "A", however, there has been a develpment. Apparently, someone in Paphos has sought a legal answer to the problem a copy of the outcome is with one of my residents who is going to bring it to me to see. I will keep you informed.

Alan

[Mike Strand]

Nigel

Yes! the company name does start with the letter "A", however, there has been a develpment. Apparently, someone in Paphos has sought a legal answer to the problem a copy of the outcome is with one of my residents who is going to bring it to me to see. I will keep you informed.

Alan

Did you ever get to the bottom of this Alan? From my reading of this document, it appears to me that insurance of the jointly owned buildings is the responsibility of the management committee. http://www.news.cyprus-property-buyers. ... cyprus.pdf

[Nigel Howarth]

From my reading of this document, it appears to me that insurance of the jointly owned buildings is the responsibility of the management committee.

The Management Committee is responsible for insuring the common parts of the building.

Regards,

[Mike Strand]

Hi Nigel, the wording in the law is 'jointly owned property', not 'common areas'.

The floor of my apartment is the ceiling of the one below & the side wall is shared with my neighbour, ie., jointly owned. What if I was the only person in my block to carry buildings insurance and there's an earthquake destroying all 6 apartments? My insurance is not going to pay just for the reinstatement of my 1st floor apartment. It would be a nightmare if the other 5 were not insured. For each owner to take out their own insurance would be crazy and an impossible administrative task to ensure everyone had paid their premium. That is surely why The Immovable Property (Tenure, Registration and Valuation) (Amendment) Law of 1993 requires the Management Committee to insure all Jointly Owned Property. Clauses 38K & 38L specifically refer to this insurance requirement.

To say that compulsory insurance is only required for the common areas would be nonsensical and to thereby ignore the more important part; the buildings themselves!

From the answers received from lawyers advising the previous management committee, I get the distinct impression the lawyers cannot be bothered reading what the law states and just give an answer to suit whatever the questioner wanted. They had said that only Owners could be on the Committee and also that a husband & wife could not both stand for election!

[Nigel Howarth]

Hi Mike,

The law is an ass - it's a complete mess - it's no wonder I get so many emails and queries about it.

There is a very good summary of what insurance is needed. You can find it on my website at http://cdn.cyprus-property-buyers.com/w ... cyprus.pdf .

Unfortunately, many people here will tell you what you want to hear - not necessarily the truth. A decent property lawyer will know what he/she is talking about.

Regards,

[Mike Strand]

Thank you Nigel. Yes, exactly as I described! So, a decent property lawyer will know what he/she is talking about. Do you have any names???

[Nigel Howarth]

Do you have any names???

The British High Commission publishes a list of lawyers that you can find at https://www.gov.uk/government/uploads/s ... lators.pdf

Have a word with Louise Zambartas (last on the list) - she specialises in property matters.

Regards,