We have now completed negotiations for the renewal of our group insurance policy on 25th March 2023.
Insurers Zurich and Ecclesiastical have generally held premium rates at last year’s levels.
Some properties have however been moved from Zurich to Ecclesiastical, in return for rate reductions of up to 11%. Ecclesiastical could only offer savings for certain types of building so the potential to transfer was restricted. A limited number of properties also benefit from reductions without moving insurer.
We acknowledge that rate reductions are not available for most sites, including those that received the highest levels of increase in 2021.
Our brokers conducted a further tender on the Zurich portfolio but were unable to find another insurer prepared to compete. Some individual properties covered by both insurers were offered to the market in isolation, but no alternatives were identified.
The biggest influence on pricing this year is re-building cost inflation. Every year insurers specify an indexation level, by which the declared value of buildings increase to reflect construction industry inflation. This year some insurers are specifying up to 20% indexation. We are pleased to confirm that we have negotiated a lower level of 10%. Unfortunately however, some premiums will still increase as a consequence.
The market for residential blocks remains very difficult. We expect pricing in the sector to ease however as fire safety defects in buildings across the UK are remediated. Pricing even for buildings without safety defects has been influenced by overall insurer sentiment. We do not expect premiums to return to historic levels in the medium term.
We will continue to do everything possible to ease the burden of premium levels in the future.
Your freeholder receives a commission from insurers for the work its Insurance Department does to support the programme. The level of commission will reduce in 2023, for the fourth year running, in view of the historically high premium levels applying across the UK insurance market.
We will shortly send out this year’s invoices and insurance certificates. If you anticipate difficulty in settling your invoice, please contact our Late Payments Team, (not the Insurance Team) as soon as possible after renewal on 25th March.
Further detailed information is available on the FAQ’s/Insurance section of our website, www.eandjestates.co.uk. Please note that we are not able to enter individual correspondence where questions are answered by the website material.