Select Page

Landlords be aware, on the back of a recent instance, you face an increased risk that renters will challenge. The case in question related to tenants’ challenge of  insurance prices the Tribunal found in favour of the tenants, because the expenses incurred were considered to be unreasonable.
Where leases require insurance prices to be’reasonably incurred’ or just’reasonable’, landlords need to:
The superior charged must be reasonable and competitive in the market, but this doesn’t necessarily imply that the insurance policy available is the option. Other variables (such as the terms of the rental, the obligations should be insured, the conditions of the coverage, credit rating of the insurance company ) will be applicable;

  • be ready to supply evidence to tenants to attest the landlord acted rationally when incurring the price and that it is a fair charge in the circumstances; and
  • when utilizing block policies, consider if tenants are negatively impacted from the block insurance.
  • Whilst the current case linked to insurance premiums such as a block that is residential, it would seem obvious that the same principle could apply to commercial rentals where  a service charge price or insurance premium has to be’reasonably incurred’. It would be prudent for commercial landlords to carry the measures over when the costs have to become’incurred’ or’realistic’.