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Changes to Residential Multiple Occupancy Insurance

The Financial Conduct Authority (FCA) has recently published changes to rules relating to insurance for multi-occupancy premises following concerns around insuring high-rise buildings in the aftermath of the 2017 Grenfell Tower fire.

They concluded the insurance market was not working in the interests of Leaseholders, regardless of the type of property they lease. The new rules are designed to give Leaseholders rights similar to other policyholders and to receive information about the insurance cover being arranged, for which they have to pay.

The new rules apply to renewed or incepted policies since 31st December 2023. Notably, this is one of the shortest implementation periods set by the FCA who considered it important to have the new rules in force for the beginning of 2024.

What changes should you expect from your insurance broker?

Your broker will be required to disclose key information about the product and their services in new disclosure documents which will include information on:

  • A summary of policy features, including the main benefits, coverage and exclusions of the policy, its duration, and the insured sum
  • Clear pricing information including the premium and relevant tax
  • The total remuneration received for arranging the insurance, including commission paid by insurers. Remuneration paid to other parties including unregulated Property Managing Agents (PMA)
  • Any ownership links between the intermediary and any insurers, and about the insurers with whom the insurance is placed
  • The number of alternative quotes that have been obtained (further details to be provided upon request) and a brief explanation as to why the proposed policy is right for both the Freeholder and Leaseholders


Under the new rules regulated, your broker will be required to:

  • Act honestly, fairly, and professionally in accordance with the best interests of Leaseholders and Freeholders equally
  • Consider Leaseholders as a relevant part of the target market when designing, pricing, and distributing their products
  • Demonstrate that products provide fair value to Leaseholders. This means there must be a fair relationship between the total price and the overall benefits the Leaseholder receives

The FCA’s reforms on multi-occupancy buildings insurance have introduced a new era of transparency and accountability.

While Insurance Brokers, Freeholders and PMAs may face increased administrative burdens, these reforms ultimately benefit Leaseholders by ensuring fair pricing, increased transparency, and improve consumer confidence.

If your Insurance Broker hasn’t told you about these changes, we recommend you act quickly. If you need ProAktive’s help, please get in touch.

Doncaster: 01302 341 344

Sheffield: 0114 243 9914

By Samantha Geddes Cert CIISME Broking Manager









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