Wednesday 25 November 2009

Insuring homes at risk from flooding

Following on from the recent severe flooding in the Lake District, there was an interesting article in Monday 23rd November 09's edition of The Independent.

Entitled "In need of cover insuring homes at risk" by Lewis Smith, it said that more than half a million homes have been built in areas regarded as being at serious risk of flooding and up to a million more could be constructed by 2020.

On the jml insurance website we have been publishing reports for the last couple of years including contributions from the ABI, The Association of British Insurers.

The article said Finding out if your property is one of them is a comparatively simple matter, but getting them insured can be problematic.

Flood risk maps have been produced by the Environment Agency and householders can check their risk level on their website.

Insurance companies have access to the Environment Agency's mapping, but have also carried out their own studies to assess risks.

You will normally find in an insurance proposal form a question as to whether the property is located in an area that is a risk of flooding. Properties built in areas where there is a high risk of flooding may be impossible to insure, at least at an affordable rate.

The Government has agreed a deal with the insurance companies whereby they have pledged that most high risk properties with existing policies will continue to be covered. However the premiums and excess rate could still rise considerably and the insurance companies are under no obligation tp offer policies to new customers. This of course can make some properties unsellable. Another problem area will be getting payouts because it can sometimes take years for the payment to be made.

Properties that are considered to be uninsurable can be modified to make policies more affordable or bring down the excess. The following are some examples.

  • Raising the height of the electrics
  • Replacing chipwood doors with melamine
  • Installing concrete floors instead of wooden flooring
  • Using flood resistant plaster

If you are looking for Flood damaged property Insurance Click Here

Wednesday 18 November 2009

Carbon Monoxide is The silent killer

Just had this message in from the NLA - National Landlords Association. They say that

"Carbon monoxide is often referred to as 'the silent killer', can you spot the signs? "

Carbon-based fuels are safe to use, but faulty appliances and blocked flues can cause the build-up of poisonous carbon monoxide gas. Carbon monoxide is odourless, colourless and tasteless making it difficult to detect. Signs include*:

Stains, soot or discolouring around a gas fire or at the top of a water heater
A yellow or orange flame on a gas fire or water heater
Pilot light frequently blows out
Increased condensation inside windows

Don't put your tenants at risk

If you are a member of the NLA The NLA now offers carbon monoxide detectors to members for less than £20. Register free with the NLA Online Store and have access to our range of safety products, courses and publications. Discounts are available for NLA members.

Installing a carbon monoxide detector is no substitution for ensuring that your gas, oil, and solid fuel appliances are safe and in proper working order. For details of landlords' legal responsibilities please visit the NLA Landlord Library.

For more about carbon monoxide awareness and the Health and Safety Executive’s guidance on carbon monoxide alarms, visit the HSE website.

*Source: Health and Safety Executive: Gas safety - Carbon monoxide awareness

If you are a landlord, Why not join the NLA ? We joined way back in the early 1980's when it was known as The Small Landlords Association and have found it be very useful over the years

Tuesday 17 November 2009

2 New articles today from Animal Friends Insurance

Dani from Animal Friends Insurance sent us a couple of articles this afternoon.
The first is called

"Top 5 Pocket Pooches" - Toy dogs are generally easier to care for, but they are usually not fond of children and large families. They also tend to be a bit "yappy", however they are loyal and intelligent and great entertainers. Here are just five favourite pocket pooches:Yorkshire Terrier
- Shih Tzu -Chihuahua - Maltese - Cavalier King Charles Spaniel. We have posted this in full on the jml insurance site here.

The second one is called "Who Will Take Care of my Pet While I'm on Holiday?" Kennels,cattery, professional pet sitter, friend or even take it with you.

The article gives some very imprtant advice and it is located here

If you have any comments why not make them on our blog?

Friday 13 November 2009

Endsleigh now helps LetSense customers

Following on from our report on this blog on Tuesday, 10 November 2009 entiltled "Letsense Reference Insurance to Close" , the news service for property matters "Homemove" today has reported that

EndsleighLet extends helping hand to LetSense customers. They say that EndsleighLet is the latest insurer and credit referencing agency to extend a helping hand to LetSense customers.

LetSense is due to cease trading on 7th December and Endsleigh’s Carlos Thompson is offering its existing customers a seamless transition to his firm’s referencing system.

The system is powered by Experian and provided online, enabling 88% of references to be completed within 48 hours.

In addition, the general manager promises to match LetSense’s current customers’ prices and will waive all costs involved in the transfer of services.

Mr Thompson assures: “We want to make this transition as easy as possible by fast tracking all customers and guaranteeing access to our streamlined insurance and referencing services within 48 hours.”

Earlier this week, HomeLet offered similar assistance to LetSense clients. John Boyle, HomeLet’s managing director, said he has been contacted by a number concerned lettings agents and that his company is determined to fill the gap left by LetSense.

How many more insurance providers will not join HomeLet and Endsleigh?

Tuesday 10 November 2009

Letsense Reference Insurance to Close

Letsense which was launched by chief executive Peter Knowles and Brian Turney, former managing director of Letsure in October 2008, has put its 12 staff on notice.

HomeLet's Managing Director John Boyle has offered a lifeline for LetSense agents who have were advised on the 9th November 09 that their referencing provider is to close on the 7th December 2009.

In a statement issued by LetSense to its customers the firm stated: “We have reluctantly had to take the decision to cease trading with effect from Monday 7th December as we have been unable to secure continued backing for our operations.”

A number of LetSense customers concerned about the closure have already been in contact with HomeLet. John Boyle of HomeLet said" “At HomeLet we support a network of around 4,000 letting agents and regularly reference in excess of 1,500 prospective tenants every day,”

“We’re confident that we can easily cope with any additional references generated by letting agents who currently use LetSense, whilst continuing to provide a seamless service for every agent.”

“Our New Agent Team has set up a hotline for concerned Letsense agents, and we have a team of people ready to process any applications from agents. We will guarantee to set any affected letting agent up as a HomeLet customer, so they can transact their references and guarantee their landlords’ rent through us, before the closure date of 7th December,”

“A delayed reference can mean the loss of a tenant which in turn could lead to a landlord choosing a different letting agent. At a time when competition is still very fierce on the high street, clearly this is not a good time for letting agents to let their customer standards service drop.”

HomeLet currently supports a network of around 4,000 letting agents and regularly reference in excess of 1,500 prospective tenants every day.

The company recently announced that 91% of references are completed within 72 hours and 78% within six working hours.

The firm has guaranteed that it will set up new customer accounts and allow LetSense agents to transact their references and protect their landlords’ rents, before the closure date of 7th December.

Monday 9 November 2009

Flood victims suffer as insurance costs rise

Flood victims continue to face spiralling costs for home insurance as excesses for flood cover rise to levels that are making their properties virtually impossible to sell.

Many have invested thousands to protect their homes from flooding, but these efforts are rarely rewarded by insurers.
"People are coming to us with huge premiums and flood excesses of up to £30,000, which is as good as having no insurance at all and makes their property virtually worthless," says Mary Dhonau, chief executive of the National Flood Forum, a charity that advises flood victims.
"The problem has got steadily worse over the past year and we are now being overwhelmed by calls from homeowners who have spent a huge amount protecting their property, but are still being charged ridiculous premiums or refused cover altogether."

Chris Wreghitt's Axa home insurance premium leapt to more than three times what it had been when his Worcestershire property was flooded in 2007.

"Prior to the flood, I was paying just under £1,000 a year, and when I came to renew in 2008 they put the premium up to £1,638," he says. "But this year they wanted to increase it to £3,747."

There was a big excess too, though Wreghitt negotiated it down. "The first time I renewed, they wanted to impose a flood excess of £20,000, but I complained and they cut that to £10,000."
However, according to Ray Boulger, senior technical manager with mortgage broker John Charcol, even a flood excess of £10,000 can present serious problems if you want to sell.

"Any lender would be nervous if the flood excess was above £5,000, and it could be very difficult for a potential buyer to get a mortgage," he says. "This could make the property difficult to sell or it would have to be sold at a significantly lower price."

A spokeswoman for Axa said the company now imposed a maximum flood excess of £10,000, adding: "Mr Wreghitt initially took out his home insurance policy at a considerably discounted introductory price. Following the floods of 2007, the premium was up-weighted to reflect the risk of future flooding, as well as the very substantial six-figure claim that had been settled.
"In 2009, the premium was re-assessed to bring it in line with our normal pricing criteria and the value of his home and contents."

By 2008 559,000 homes in England and Wales were at serious risk of flooding, according to the Environment Agency, up from 517,000 in 2006. This increase looks set to continue as the agency's techniques for predicting which areas will flood improve.

"Our mapping processes for identifying flood risk are getting better and more properties are being designated as at risk of flooding," said a spokesman for the Environment Agency.
Since the floods in 2007, the Environment Agency has invested heavily in flood defences and has set up an early warning service which uses text messages to give those at risk advance notice of an impending flood. But the agency is disappointed that these steps, and those taken by customers, are rarely reflected in lower insurance charges.

"Only a handful of insurers are rewarding people who make their properties safer or sign up to our flood warning service with lower premiums and lower excesses," the spokesman for the Environment Agency said. "We would urge insurers to take account of floodproofing work and people signing up to our warning service."
Pensioner Sue Jenkins Clarke thought she would have no problem selling her Cheltenham home after she borrowed £25,0000 to have the garden flat "tanked" to protect it from flooding (the foundations are made waterproof so that moisture cannot rise from the water table), after water had seeped through the floor during the floods of 2007. But in September, a few days before contracts were due to be exchanged, her buyers pulled out.

"They said it was because they couldn't get contents insurance from anyone because of the flooding," she says. "I couldn't understand it because I still had contents cover and the money I had spent meant the water seepage problem couldn't happen again."

When Jenkins Clarke checked with her insurer, they told her they were happy to continue providing cover, but would take the same view as other companies when it came to a new owner.
"It seemed illogical that I could get cover but my buyer couldn't," she says. "It felt as if there was no way to get out of here and I began to feel angry."

Fortunately, the National Flood Forum was able to point Jenkins Clarke to a specialist broker who could arrange the necessary cover, but she has yet to find a buyer.

Insurance broker Neil Cook, of Equity & General Insurance Services, which specialises in flood insurance, says it can be worth looking beyond the big-name firms when it comes to flood cover.

"Some big insurers had their fingers burnt in 2007 and have become extremely cautious," he says. "But specialist brokers use smaller underwriters that were not so severely affected and are still willing to look at individual cases and levels of risk rather than imposing a blanket policy."
In 2002 the insurance industry agreed with the government to continue providing cover to existing customers whose homes were designated at significant risk of flooding and, crucially for people selling their homes, in 2008 this commitment was extended to cover new owners of affected properties. So Jenkins Clarke's insurer, for example, should have covered the new buyer. However, there are no limits on the premiums or excesses that can be asked of a potential buyer, as Michael McDonald discovered when he came to sell a cottage which had been affected by flooding last January.

When McDonald's wife inherited the Lancashire property in March, there appeared to be no problems with the insurance. Aviva, the insurer, had only increased the premium from £696 a year to £840 after the flood claim, and the Environment Agency had told McDonald the flood was a one-off occurrence.

But last month, just days before completion, the buyer for the cottage threatened to pull out because Aviva wanted to increase the annual premium to £2,800 and impose a flood excess of £8,500.
"The buyer said these charges were like taking out a second mortgage and he couldn't afford them," says McDonald. "I told him I'd find him cheaper insurance and tried the internet comparison sites, but they all rejected the property because it had been flooded."
Neil Cook came to McDonald's rescue. "They managed to get the new owner a home insurance premium of just £750 a year with an excess of £2,500," he says.

An Aviva spokeswoman said: "The property flooded in January 2008 and we paid out £52,000 in claims costs. The property has had a sizeable flood claim and therefore in our view, is at very high risk of flooding. Only a very small percentage of our customers who have been flooded will receive an increased excess, however it is likely that customers who have made a large flood claim will attract an increased excess."

Malcolm Tarling, of the Association of British Insurers, says anyone having problems getting flood cover should use a broker to help them get the best deal. But he insists that insurers have good reasons for exercising caution when it comes to flood insurance.

"The average flood claim in some parts of the country can be up to £45,000 and in the summer of 2007 insurers paid out £3bn, the equivalent of four years' claims, in a period of just six weeks," he says.

"In addition, there is scientific evidence that severe weather incidents are becoming more likely and more severe, and insurers have to take this into account."

What to do if you have been flooded

• Use a broker to find the best insurance deal – the National Flood Forum • Do not cancel your insurance policy until you have another

Source: Neil Cooke 9-11-09
Comment Received by email 11th November 09

I had a client ring up yesterday he lives in east London although there was a local brook that burst its banks 10 years ago it is not a high risk area he had about £1200 for years I quoted him £476 !!!!!

If you live in SOUTH WOODFORD E18 or similar areas that can be deamed to be in flood plains or possible flood risks areas, please do not fall into the trap of thinking you are getting a fair insurance deal on your household policy if you deal with ansurance provider who understands the risk rather than just those online sausage factories you may genuinely be able to reduce your premiums by 60%

Saturday 7 November 2009

The Midas Touch Lloyds Banking Group sale of Heal

The 23rd October 09 edition of the estate agents magazine "The Negotiator" has an introduction editorial "The Midas touch" regarding the Lloyds Banking Group's proposed sale of the Halifax Estate Agents (HEAL) to the LSL Group.

The HEAL network had reported losses of over the past three years of some £51.1m and naturally following on from last autumn's problems with the Government injecting money into the group, that would be one area they would want to dispose of fast.

Lloyds Bank and TSB were early players in buying up chains of estate agents in the 1980's. Lloyds created "Black Horse Agencies" and TSB had "TSB Property Services". The Halifax soon followed. Lloyds and TSB before they merged and became Lloyds TSB was to retain the local name they had paid a lot for, like Gascoigne-Pees, Stimpsons.

The Halifax paid a lot of money for well known local names and re-branded them as "Halifax" so that the consumer would associate their local estate agent with the Halifax Building Society. The Leeds Permanent Building Society also like other building societies set up it's own network of estate agents. Like Lloyds, they kept the local trading names they had paid for like Gale & Power, Frank Farr

When Halifax and The Leeds Permanent merged, the original trading names of the old Leeds Group were retained and there is still a Frank Farr branch in the Langley, Berkshire.

Had there been no banking crisis in 2008, it would be interesting to know how much longer the Halifax group would have retained their network for.

According to the interview with Simon Embley of LSL in The Negotiator, the branches taken over will be rebranded to fall into their existing network of names like Your Move, Reeds Rains and Intercounty. At LSL is using well known brand names they have paid for.

Another chapter in the estate agency cycle in the UK. What will happen in the next 10 years?

Friday 6 November 2009

It is early November and the Irish Times has lost weight

The Irish Times 5th November 09 edition arrived yesterday. What has happened to the property supplement?

Last week there were sevel pages with a lot of colour ads for estate agents, but this week.... There are eight pages only.

It is very thin. Traditionally the paper's property section takes an August break and Christmas break, however it looks like the winddown to Christmas is very early this year.

There is colour on page one and page 8, but all the rest is black and white. Is this like the state of the Irish property market?

As you will see from the photo above there is an ad for a developer on the bottom of the front page and page 2 has the traditional "Take Five" where an Irish property is for sale for so many euro and they show what you can buy for the same amount of money in different countries like France, Spain, Portugal. England, Croatia, South Africa, Turkey etc.

On page 3 there is a full page ad for Ireland's leading estate agents Sherry Fitzferald - in "Black and White" and that is the only estate agents ad in the paper.

The property market in Ireland is not too good as shown on page 4 with the headline " That 40 per cent drop - it's already happened" going on to say that Economists have predicted that house prices have to fall by at least 40 per cent from the peak in 2006 and builders say that is already a reality.

However another headline is more positive " Business is booming for rental agent" reporting on the fact that has moved from cyberspace to an office in Pimlico Dublin 8. Hopefully they will succeed there as the lettings market appears good although who offers specialist rental insurance?

We can't find anyone and it seems like none of the UK specialists want to move into that market. At jml insurance we see a lot of enquiries from people in Ireland like one that came in today.
"Hi, i have a 2 bed apt in Dublin rented out. I wish to take out a home insurance policy especially for me as a landlord with the tenants. We paid 340,000 euro for the apt which is probably only worth 200,000 now in the current recession. I would like to get a quote if that is possible for landlord/tenant insurance. thanks" We know of a broker who has been trying to help and details can be found here

Many estate agents are probably still advertising in smaller circulation local and regional papers, hopefully, some must be using the Sunday papers more and the Internet, but either they can't afford to advertise or the Irish Times is too expensive.

Anyway, don't want the Christmas break starting too early as the agents won't after Sherry Fitzgerald reported a pre-tax loss of €15.5m on last year's business.

Can anyone comment on this situation?

We now have Simple Rent Guarantee Insurance on the jml site

For those landlords who are concerned about their tenant's ability to pay rent here is some more good news. jml property Services have just added Simple Rent Guarantee to their two insurance service websites.

With unemployment and rent arrears rising, an increasing number of tenants are
struggling to meet their financial obligations. You can't predict what the future holds for a tenant so to provide Landlords an additional level of protection Simple has developed Simple Rent Guarantee and Legal Expenses Protection which starts from as little as £45 (according to the information they have provided us with).

Simple have now joined a list of other providers including Letsure - HomeLet - Rentguard - Endsleigh in offering this type of product on the buy to let market.

People of course say this will never happen to me, or insurance is a waste of money. Well you never know when the perfect tenant looses his/her job and whatsmore you should of course being declaring your rental income on your annual Tax Return. Like a great deal of expenditure on a rental property - agents fees - accountants fees - repairs etc, insurance payments should be included to reduce your tax liability. Check it out with your accountant.

Tuesday 3 November 2009

HomeLet tenant's Contents insurance is selling well

3rd November 2009, only two days to go to fireworks celebrations, however no fireworks in the the latest HomeLet Agent's Newsletter - workingtogether . A good selection of topics including an introduction by the HomeLet Managing Director John Boyle. He is hoping to see the sales activity in the housing market will continue and more reluctant landlords will try selling once again.

Well apparently what is selling well are the new HomeLet Tenant's Contents + Insurance Since the new tenants policy was launched in June this year sales have been excellant. The product is very good value for tenants in today's cash conscious climate.

The new policy is even better value for money than before. It still covers accidental damage to the landlord's contents, buildings, fixtures and fittings up to the value of £2,500 and now there is a higher level of cover for the minimum sum insured which has changed from £2,500 to £5,000.
The new policy also allows for up to three people to share the same policy as long as they are employed and not a full time student so no wonder sales are good.

Last week there was a press release saying that HomeLet has managed to double the number of policies sold in just six months. No fireworks however. If you are having a celebration, however make sure your pet is inside. Many dogs and cats are not very happy with this time of year as firework events seem to go on for several days. Animal Friends Insurance issued a press release about this last week and the details are HERE