A common question that comes up is regarding responsibility for leaks. If the apartment above mine leaks into my apartment and causes damage, who is responsible for the repairs?
The two insurances to note:
The Block Policy – As an apartment unit within a management company (OMC) controlled block, there will be a management company Block Insurance policy (the ‘Block policy’) in which all owners contribute to via their annual management fee.
Landlords Contents Policy – Landlords Insurance provides you with cover for accidental death or injury or illness to tenants living at your property. Loss of rental income can be included to provide financial protection if your property becomes unfit to live in because of damage. Contents cover will protect the contents that you own and have provided for tenant’s use.
As a landlord, the first thing to do is contact the managing agent for the block and report the incident as they may want to notify the Block Insurer (depending on the amount of damage). The managing agent may also want to send their own plumber to mitigate any further damage.
A consideration here will be the level of excess applicable to the Block policy for water damage. This is the first part of any claim which is paid by the insured, not the insurer. The excess for the “accidental escape of water” is often €2000 or even more sometimes.
On the assumption that the damage level is sufficient to exceed the policy excess, Insurers will appoint their own Loss Adjuster to come out and view the damage, determine the cause and assess the likely cost or repairs.
Who is responsible for the excess?
In general, the Management Company (of which you are a member) are the policyholders, but the individual submitting the claim is responsible for paying the excess. This is standard business practice.
The one time that this may not be the case is when the management company themselves may be at fault. For example, a common pipe running through the building leaks. In this case it could be argued that the Management Company are at fault and should pay the excess. They may not necessarily be legally obliged to do this, but they may decide to do so, to be fair and reasonable.
If the apartment above you flooded and caused damage to your property, but you are the one making the claim, then you will be responsible for the excess. This seems very unfair but unless you can persuade your neighbour to contribute out of decency, you will be liable to pay the excess personally.
The way in which management companies deal with excess varies from development to development and within a development it varies from incident to incident. It is always worth finding out from the OMC what is the standard procedure for similar incidents.