A Cranham leaseholder believes the impact of an upcoming council buildings insurance hike on residents “is going to be huge” - as her own costs are to rise by nearly 208 per cent.
Karen Randall, 67, said she received a letter in January from Havering Council telling her of its intention to enter into a five-year agreement with a new buildings insurance provider, after its insurer of 30 years withdrew.
Distributed to every leaseholder and shared owner in council freehold properties, it outlined how just one bidder, Protector, was suitable after the council went out to tender, with a second applicant unable to provide full flood cover.
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In the letter, seen by the Recorder, the council concedes the new contract, which will start on March 31, “does unfortunately result in a significant increase for each property type which comes from a number of factors influencing insurance premiums currently”.
The pricing for the first annual premium for each property-type is detailed, ranging from £467.68 a year for one-bed and studio leaseholders, and £777.39 for three-bed, six-person shared ownership properties.
Karen, who lives on her own after her husband died several years ago, said if the contract is to go ahead, her costs will increase from £185.53 a year to £573.05 - a rise of almost 208pc.
She said she does not have a mortgage, but thinks that the impact of the rise on other residents “is going to be huge”.
Karen added, for her, it is “the little extras” which will be hit the most.
“I run a little social group for ladies who have lost their husbands,” she said, “and we meet for lunch or we go for coffee, sometimes we go to Queen’s Theatre.
“But £30 per month means I can’t buy a ticket to the theatre in Hornchurch, it means I can’t meet the ladies at a café in Romford for breakfast.”
Cllr Paul McGeary, cabinet member for housing, said the increase is “beyond the council’s control and is caused by a number of different factors”.
He said: “The current insurance market is extremely tough. Inflation along with increased rebuilding costs and supply chain pressures for building repairs are pushing up premiums across the board.
"The impact of increased severe weather such as storms and floods plus fires has also had an effect on the insurance market, nationally, due to higher claims costs.
“As a result, this has led to many insurers leaving the market causing an even smaller pool of providers to choose from. In turn this has driven up the price of premiums and has meant some boroughs have not been able to secure any insurance providers at all.”
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Cllr McGeary added that, while the council appreciates the increase is unwelcome, as a freeholder it is obliged to arrange buildings insurance and recharge the costs to leaseholders.
For those concerned about the cost of living, find help and advice on the council’s webpage here: https://www.havering.gov.uk/costofliving
Protector was approached for comment.
Are you to be impacted by the buildings insurance rise? Let us know if so, and how, by getting in touch at ben.lynch@newsquest.co.uk
This article was updated as Karen's new cost will be £573.05, not £577.05. The percentage increase was also amended.
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