What has the Council commented on regarding the impact of retro-fitting water sprinklers on building insurance?
At the Housing and Regeneration Overview Scrutiny Committee (HROSC) meeting of 14 September 2017, the following was stated in Council Paper 17-269 with regards to the potential impact on building insurance should the retro-fitting of water sprinklers take place.
“24. It is anticipated that retro-fitting sprinklers in high rise blocks in the Borough will result in a reduction in Buildings Insurance premium costs to the Council and subsequently to leaseholders. It is not known at this time whether this will have the same effect on Home Contents Insurance costs, or whether this would make it easier for residents in high rise blocks to obtain Home Contents Insurance cover if the property has sprinklers, as the Council has no involvement in arranging Home Contents Insurance for Council tenants and leaseholders”.
So, there is, according to the Council scope for leaseholders to save some £££s on their buildings insurance if water sprinklers have been retro-fitted?
How much do leaseholders pay in buildings insurance?
This would, one would guess, vary depending on estate and block charges and how many bedrooms the apartment would have?
Let’s have a look at an example which is 2 bedroom flat on the Alton Estate for the 2016/17 service charge period.
So, the building insurance paid was £13.16(!). Let’s say, for an example, that retro-fitting water sprinklers reduced the building insurance by 20%, the savings would be £2.62. This does not take into account inflation or future changes in pricing.
How much could the Council save in buildings insurance?
According to Paper 17-269 the numbers impacted are “Wandsworth Council has 99 blocks of ten storeys or more containing 6,401 residential flats and maisonettes – 4,043 tenanted, 1,315 resident leaseholders and 1,043 away leaseholders”.
As a very rough proxy, let’s say that each of the 6,401 residential flats and maisonettes then we minus the leaseholders from the overall numbers as they are the ones paying the buildings insurance themselves. That leaves 4,043 flats which the Council is responsible for, meaning that the total savings would be 4,043 x £2.62 = £10,592.66. This does not take into account inflation or future changes in pricing.
Please note all figures have been provided on a best efforts basis in an attempt to try and assess the potential savings to the Council and to leaseholders.
Summary
If part of the retro-fitting water sprinklers sell is the savings on buildings insurance, then leaseholders, individually may not see much in the way of a benefit?
It is wondered how much the Council stands to gain from such potential savings?
Caveats
Please note that all information is provided on a best efforts basis and that readers should make their own efforts to review and assess the provided content.
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