Broker alleges corruption over block of flats insurance
Insurance broker Neil Cook of Ember JD Insurance, is raising concerns about the cost of insuring whole blocks of flats.
He says he is aware that hidden commission charges are being shared between brokers and managing agents at the property owner’s cost.
In a recent article in the Observer, Mr Cook suggested that some property owners are paying up to double the market rate for buildings insurance because brokers are paying “kickbacks” to the property agents who manage their homes.
He alleges that in some cases, backhanders are funded by insurance brokers choosing the insurer that pays the most commission, instead of the company that offers the best value.
Leaseholders are largely oblivious to their losses because they frequently have no idea which insurance company is covering the block.
Frequently, management companies simply send out an annual request for “ground rent service charges and insurance”.
Speaking to the Observer Mr Cook states: “I see a lot of inflated premiums for blocks of flats where it just doesn’t add up, and there is no way the broker has sought the best deal … sometimes it is as much as double but, typically, the premium is about 30% above what you would expect to pay.”
Category: Business Insurance News, Insurance News
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