There was a leak coming from the property above mine, it has caused damage to my ceiling, wooden floors and tenant’s laptop, is this covered by insurance and who is responsible?
On the assumption that your property is a rented apartment unit within a management company (OMC) controlled block, there will be a management company Block combined (property and liability) insurance policy (the ‘Block policy’) in place in the normal course, which you as an owner contribute to via your annual management fee and this is paid to date.
- Your first port of call therefore is to contact the managing agent, report the incident and ask them to notify the incident to the Block Insurers, without delay.(N.B. – you may also need to notify your Landlord’s Contents insurer if damage to your own contents provided for the let are damaged also)
- Managing agents may also wish to send out their own plumber to access and stop the leak to mitigate any further damage throughout the block. Depending on the amount of damage caused by the leak, managing agents may wish to discuss with you whether they intend to notify Insurers of the damage. A consideration here will be the level of excess / deductible applicable to the Block policy (i.e. first part of any claim borne by the insured and not the insurer) in respect of Escape of Water claims. It is not unusual for a €1,000 / €2,500 / €5,000 excess to apply to these type claims in a large block, depending on the historical claims experience of the policy in respect of previous water damage. If a €2,500 excess were to apply to Escape of Water / Water Damage claims, the damage (cost of repair) to your apartment would need to be assessed initially to determine whether it is likely to even reach the excess level. Managing agents would need to discuss this with you and make a call on it at this stage.
- 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.
Unless provided for separately in the (residential) lease / licence agreement, you as the landlord / accommodation provider are generally responsible for repairs and maintenance within the rented apartment unit and this would extend to include repairing water damage to both the ceiling and wood floor. However, this responsibility would generally not extend to the tenant’s laptop or any of their own personal possessions. Your tenant should be advised to maintain his/her own Tenant’s Contents insurance to cater for loss of personal contents including items like the said laptop, bicycles etc.
It is fair to say that some Apartment Block insurance policies exclude claims for damage to wood or laminate floor coverings. This being the case, you should have your own Landlords’ Contents policy in place, one specifically catering for damage to such floor coverings in your rented unit. However, on the assumption that the Block policy in this scenario does not contain such ‘wood / laminate floor coverings exclusion’, the Loss Adjuster will factor in the cost of replacing (or repairing where feasible) the floor covering due to the water damage it has suffered. If the unit is uninhabitable and you lose the tenant i.e. rent is not paid, the loss in rent is usually recoverable under the block policy for an agreed period.
The Loss Adjuster will report back to the Insurer and recommend that the claim is paid in full, or is adjusted for payment and is subject to the prevailing policy excess. Alternatively, the claim can be declined for a stated reason albeit recent (CICA) legislation makes it even harder for an Insurer to decline or hold a claim settlement. Repairs can commence at this stage and the unit is made fit for occupation again without delay and the tenant returns.
Response Credit: S.A. Faughnan Brokers Ltd