When managing a block of flats, it’s easy to focus on day-to-day maintenance and overlook risks that seem unlikely. But that doesn’t mean they’re not important. Terrorism Insurance is one of those critical protections that’s often forgotten until it’s needed!
Terrorism Insurance
for Residential Blocks
What is Terrorism Insurance?
Terrorism Insurance protects your block against damage and financial loss resulting from acts of terrorism. This includes:
- Damage to the building caused by explosions or attacks
- Loss of rent or service charges
- Costs associated with rehousing residents
- Rebuilding and repair expenses not covered by standard insurance
While it may seem like a remote risk, the financial consequences can be severe. And standard buildings insurance typically excludes damage caused by terrorism unless the cover is specifically added.
Is it a lease requirement?
Many residential leases include a clause requiring the freeholder or managing party to fully insure the building, often including cover for “all risks” or specifically for acts of terrorism. Failing to have this in place could mean:
- You’re in breach of the lease
- The RMC or freeholder could face legal action from leaseholders
- Claims could be rejected if damage is caused by an act of terrorism
Checking the lease wording carefully – and ensuring the correct cover is in place – is a crucial part of your duties as an RMC.
Why does your block need it?
- Legal compliance: many leases require it
- Financial protection: terror-related damage can run into millions
- Peace of mind: protects leaseholders, residents, and the RMC
- Mortgage requirements: some lenders won’t approve mortgages on flats in blocks without terrorism cover
Even if your building is not in a high-profile location, insurers increasingly recommend terrorism cover for all residential blocks, especially those in urban areas.
What’s covered?
Our Terrorism Insurance can provide cover for:
- Property damage: Covers physical damage to insured property caused by acts of terrorism.
- Business interruption: Covers the ensuing loss of income and other business costs following an event.
- Additional costs: Can extend to cover things like relocation expenses, counselling, and security upgrades following an incident.
- Active assailant events: Some policies can be extended to cover situations where there is no property damage but physical injury, such as attacks involving a vehicle or multiple people being injured.
- Other threats: May also include coverage for other forms of political violence, such as riots, coups etc
We work with leading insurers to make sure your cover meets all lease obligations and lender requirements.
Key benefits:
- Protects directors, senior managers, officers, LLP Partners and committee members
- Covers legal defence costs (including costs associated with regulatory investigations) and compensation
- Optional cover for the company itself (Corporate Legal Liability)
- Peace of mind for those managing the block on behalf of leaseholders
Don’t risk a lease breach or financial exposure
Terrorism Insurance might not be the first thing you think of when managing a residential block but it’s a vital part of comprehensive property protection. We’ll review your lease, assess your risk, and help ensure you have the right level of terrorism cover in place.
