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Leasehold buildings insurance explained

Own a leasehold property? That means you own the home, but not the land it sits on—the freeholder does. Your lease gives you the right to live there for a fixed term, often decades or more.

When it comes to protecting your property, it’s essential to know who is responsible for buildings insurance. In most cases, the freeholder arranges the insurance for the entire building—including communal areas—and you’ll pay your share through a service charge.

But not always. That’s why it’s important to check your lease agreement carefully—so you know exactly what’s covered and whether you need to take out any additional cover yourself.

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What is leasehold buildings insurance?

Leasehold buildings insurance is designed to cover the structure of your leasehold property—protecting it against risks like fire, storms, fallen trees, or burst pipes.

In most cases, this cover is arranged by the freeholder (the person or company who owns the land and building). You, as the leaseholder, typically pay your share through service charges.

It’s a good idea to check your lease to confirm whether buildings insurance is already included. If not, you may need to arrange cover yourself.

To compare leasehold buildings insurance quotes with Clarity Compare, simply share a few key details about your property—and we’ll help you find suitable cover from trusted providers.

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Who’s responsible for buildings insurance on a leasehold property?

If you own a leasehold flat, there’s a good chance your freeholder has already arranged buildings insurance for the entire building. In this case, you’ll usually pay your share of the premium through the service charge.
But it’s not always a given. To be sure, check your lease agreement—or ask your solicitor to do so. If cover hasn’t been arranged by the freeholder, you may be responsible for insuring your portion of the property.
If your building has multiple leaseholders, you might consider grouping together to arrange a joint policy. This can be more cost-effective and ensures the whole building has consistent protection in place.
At Clarity Compare, we help you understand your responsibilities and compare quotes with ease—so you can find the right cover, no matter your setup.

What does buildings insurance cover for leasehold properties?

  • Buildings insurance is there to protect the structure of your home—covering the cost of repairs or even a full rebuild if it’s damaged by:

    • Storms, floods, fire or explosions

    • Vandalism or theft

    • Fallen trees, lamp posts or aerials

    • Burst or frozen pipes

    If you live in a leasehold flat, the policy typically also covers communal areas—like stairwells, hallways, shared gardens, and even the structure of other flats in the building.

    If the freeholder has arranged the cover, you have the right to ask for a copy of the policy to see exactly what’s included. That way, you’ll know where you stand—and whether you need any additional protection.

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What to know if you need to arrange leasehold buildings insurance

If it’s your responsibility to insure your leasehold flat, here are some key points to keep in mind:

1. Covering the whole building

If you and other residents buy a joint policy, the entire block can be insured under one plan.

2. Valuation surveys

You may need a professional valuation to work out the rebuild cost—this ensures you’re not underinsured.

3. Shared spaces

If you’re a joint freeholder, make sure your policy includes communal areas like stairwells or hallways.

4. Public liability cover

Your policy should include this to protect you if someone is injured on the property.

5. Employers’ liability insurance

If you hire staff—like a cleaner or caretaker—this cover is a legal requirement.

6. Rebuild cost vs market value

Insurance is based on how much it would cost to rebuild your flat—not what it would sell for.

Even if you’re cautious, accidents can happen—especially in shared buildings. Encouraging other leaseholders to take out cover, or arranging a shared policy, can help protect everyone.

What’s not covered by buildings insurance?

While buildings insurance protects against many unexpected events, there are some things it usually won’t cover. Common exclusions include:

  • Everyday wear and tear

  • Pet damage to the building

  • Pest infestations like mice or termites

  • Poor or faulty workmanship

  • Storm damage to fences or gates

  • Contents inside your home, like furniture, appliances, and personal items

  • Issues like rising damp, condensation, or rot caused by long-term neglect

Always check the policy wording to understand exactly what’s excluded. That way, you won’t face any surprises if you need to make a claim. And if you need contents cover too, you can compare combined buildings and contents policies with Clarity Compare.

Leasehold Buildings Insurance – Frequently Asked Questions

 

How do I know who’s responsible for buildings insurance?

Check the terms of your lease agreement. It should clearly state whether you or the freeholder is responsible for arranging the buildings insurance.

If you’ve purchased a share of the freehold with other leaseholders, you’ll likely need to arrange a joint buildings insurance policy that covers the entire building, including communal areas.

Unlike leasehold flats, leasehold house owners are usually responsible for their own buildings insurance. Always review your lease for confirmation.

You may not need to arrange it yourself—many freeholders organise a block policy and recharge the cost through your service charge. However, if it’s not included, you’ll need to take out your own cover.

Yes—if the lease requires you to contribute, you’re legally obliged to pay your share. Not doing so could put you in breach of your lease.

You’re entitled to see a copy of the insurance policy. If you make a written request, the freeholder must provide it within 21 days—or face a potential fine.

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