Water Damage from Upstairs Flat – Who is Liable for the Excess?

Hi Sharon,

Your following comment raises alarm bells for me:

"but we have separate buildings insurance policies."

Normally you cannot insure part of a building only the whole building. Therefore the cover you have could be incorrect or it covers the whole value of the building. Now assuming the other owner has done the same thing you are now both insuring the whole building.

I am not an insurance expert but you cannot normally insure something twice and the insurance policy taken out 2nd is usually considered invalid and you have to claim on the first.

I would suggest you need to check your insurance policies out very carefully and if bought through a broker as for them to check it out.

This is why flats always have block policies.

Just because the neighbour’s insurance has declined liability, does not mean the neighbor is not liability for the FULL amount.

Personally I would be getting some fixed price legal advice on the above.

Hi Sharon. Somewhere in this tale of woe there should be a lease. This will detail who is responsible for what. I must say an excess of £1000 for water damage is very high. Thus is normally the excess for subsidence. An average excess for water damage is normally around £100-£250. And in my experience in leaks like this either I as the landlord with the offending flat would pay the excess or if it was down to the tenant leaving the bath or tap running etc then I would seek to recover it from them.

Reply to the comment left by "Neil Patterson" at "20/11/2014 - 12:05":

Thank you Neil. In my experience, some insurers offer buildings cover for flats, some don't. We have always insured separately, even when we were still leaseholders and there was an external freeholder. When we bought the freehold jointly a few years ago, we just carried on with separate insurance.

Reply to the comment left by "Ian Ringrose" at "20/11/2014 - 12:37":

Thank you Ian. I actually phoned the Leaseholders Association this morning on their free advice line, and spoke to a solicitor. To my complete surprise, she insisted that the upstairs flat is responsible for the damage, even if there was no negligence involved, simply because it originated in her flat, and I shouldn't even go through my insurance. It's completely the opposite to what I've been reading, and also to what upstairs' insurance and my own insurance have told me.

Reply to the comment left by "Gary Nock" at "20/11/2014 - 12:53":

Thank you Gary. We bought the freehold a few years ago, so I don't think there is a lease, although I now understand that legally, we are still considered leaseholders. We just didn't make a formal agreement as to who is responsible for what and it's worked so far. And next time I take out buildings insurance, I'll make sure I choose the lowest possible excess, which in case of my insurance would have been £500 (it's a budget insurance) ...

If it was the tenant living a tap running I would expect then to pay the FULL cost and not claim on my insurance, as why could I have a bad claim history due to their actions….

Ian the issue is that if the damage is extensive then the cost can be substantial. So to get the place up and running again you will need to get your insurers involved. If the offending tenant cant pay/won't pay then you end up either paying for it yourself with no guarantee of getting it back or involving the insurer who will take steps to recover it from the tenant. Or you lay and try a s recover it in "Snail Claims" Court which if it goes to a hearing will take many hours work, a day at Court, and fees of about £500. I know. I've just done it.

Hi Sharon, I thought I would respond as I've just been through the exact same problem. The flat above mine had a boiler that developed a leak and flooded my flat below. Their flat didn't have much damage but I had quite a bit as part of my ceiling collapsed. I contacted our buildings insurance who agreed to pay out on the damage, so got 3 quotes. At the time my tenants had given notice for this flat so I waited until they moved out and things had dried by then so started repairs. I contacted the owner above (that flat was also rented) and they refused to pay for the excess which was £500. I took them to small claims court which took about 6-8 months and cost about £400 but I won my case and was awarded all court fees, the insurance excess & two weeks rent for the time I could not rent out my flat due to work being done in it. If your tenants don't have to move out but you need to compensate them for the hassle you might be able to claim this. I hope this helps.

Thanks again for your comments. No, it wasn't a running tap, it was a hose hidden behind the pedestal. I wouldn't hesitate going through Small Claims, as they didn't do anything about it for two weeks, despite being told repeatedly. But according to the advice from the property lawyer at the Leaseholders Association, I don't actually need to go through my insurance at all, as my upstairs neighbour is responsible, even though nobody was negligent. The way I have understood it now is that her insurance won't pay because she wasn't negligent, but as it's her pipe in her flat, she's still responsible as the other leaseholder and I need to approach her directly, or claim through my insurance and claim the excess back from her. I am hoping to get some alternative legal advice tomorrow and will post on the outcome, as I think it's quite a common scenario.