Can you put your hand on the current buildings insurance policy for every residential block you manage, and say what the premium was two renewals ago?
Most building managers I speak to can answer the first half. The second half is where the conversation goes quiet, because the premium has moved so far and so fast that the number on the renewal notice no longer resembles the number in the budget. That gap is now a board-level issue, and it lands on the person holding the certificates.
The stakes: who pays when the premium jumps
Landlord building insurance covers the structure of a residential block against fire, flood, subsidence and similar perils. In a leasehold block, the landlord or freeholder arranges the policy and recovers the cost through the service charge. The leaseholder pays, but the building manager holds the paperwork the insurer, the auditor and the regulator will ask to see.
The Financial Conduct Authority found that building insurance premiums rose by 125% on average across the leasehold sector between 2016 and 2021. For leaseholders in buildings with fire safety issues, the average increase was 187%. Those are not projections. They are the numbers the government is working from, and they explain why the insurance broker pledge exists at all.
What the broker pledge actually changed
In 2023 the government agreed a voluntary pledge with 16 insurance brokers covering residential buildings over 11 metres or four storeys in height with identified fire safety issues. The pledge has three commitments, and each one touches how your block is insured.
First, brokers stop sharing commission with the parties who place or arrange the insurance, which usually means property managing agents, landlords and freeholders. That practice gave those parties an incentive to pick the policy with the largest commission share rather than the best cover for the building. Second, any commission the broker retains is capped at 15% of the total premium, including work done by third parties on the broker's behalf. Third, brokers disclose their commission to leaseholders on request, in line with FCA rules.
The pledge is voluntary, and the government publishes the list of brokers who signed it. If your broker is not on that list, that is a question worth asking before the next renewal, not after. The full pledge commitments are set out on GOV.UK, including the 15% cap and the disclosure duty.
Why fire safety evidence drives the premium
An insurer pricing a residential block is not guessing. It is reading what you can prove about the building. A current EICR, a fire risk assessment with actions closed out, compartmentation records, alarm test logs, and a clear position on cladding or combustible materials all feed into whether the building is treated as a standard risk or pushed into the layered market where multiple insurers each cover a fraction of the total.
The government's own explanation of the pledge notes that buildings rejected by the traditional insurance market tend to end up with layered policies, which cost more and are harder to challenge. The plain English explanation is blunt about why leaseholders struggle: they have little recourse to challenge service charge increases and difficulty finding information about the premiums they are paying.
That is the gap your evidence file closes. When the broker asks what has changed since last year, the answer is not a narrative. It is a dated fire risk assessment, a closed-out action log, and a certificate that has not expired.
What the regulator is watching now
The Ministry of Housing, Communities and Local Government has been monitoring the buildings insurance market directly. In summer 2025 it ran the Remediation Programme Insurance Survey, issued to responsible entities for buildings in the Cladding Safety Scheme, the Building Safety Fund, the Aluminium Composite Material Cladding Remediation Fund, and social housing remediation programmes. The survey closed on 31 July 2025, with late returns accepted to 14 August 2025, and the data was analysed by the Government Actuary's Department.
Scotland was not surveyed as part of that programme, so if your portfolio sits north of the border, the data picture is different. The research summary sets out the scope and the questions asked.
What this means for you is straightforward. The government now has a dataset on what responsible entities are paying and what they can evidence. If your building is in one of those remediation programmes, your answers are already in that dataset. If they were thin, that is visible.
How you would fare in the same audit
An insurer or regulator reviewing your block will not ask whether you care about safety. They will ask for the documents. The pattern is consistent: a fire risk assessment older than the last material change to the building, an EICR with remedial works still open, a compartmentation survey that was recommended but never commissioned, and a service charge budget that shows the insurance line rising without a corresponding note explaining why.
Each of those is a cost control problem before it is a compliance problem. A premium that jumps because the evidence file is weak is a premium you cannot defend to leaseholders, and it is the kind of increase that ends up on a director's desk with a question attached.
If your building has already been pushed out of the standard market, the related piece on what it means when a building cannot get insurance is worth reading alongside this one. And if you are still reconciling last year's premium increase, the 23% rise most portfolios missed explains where the pressure is coming from.
Your 60-second self-check
- Can you produce the current buildings insurance policy and the last two renewal notices for every residential block you manage, today?
- Do you know whether your broker has signed the government's insurance broker pledge, and can you show the commission disclosure if a leaseholder asks?
- Is your fire risk assessment current, with every recommended action either closed out or formally scheduled?
If any of those three made you pause, the free 5-minute Director's Risk Check will show you which statutory deadlines and penalties apply to your portfolio, each with its official source. You can run the check here and see where your buildings sit before the next renewal or audit asks the question for you.
Herman's verdict
The premium is not the problem. The premium is the receipt for whatever your evidence file could or could not prove on the day the insurer looked. Fix the file and the number follows.
— Herman
Until next time — keep the evidence closer than the deadline.
Walk into your next senior management meeting with the answers
The free Director's Risk Check for UK portfolios takes five minutes. No sign-up to see your score.
- Your control score across compliance, evidence, oversight, cost and renewals
- The breach exposure in your portfolio, with the official source for each penalty
- A board-ready briefing with your three priorities and a 30/60/90-day plan
About HermanWa
HermanWa is a building compliance and operations platform for property and facilities teams in the United Kingdom and Singapore, with portfolios across the Gulf. It keeps one auditable file per building — statutory deadlines, inspection evidence, contractor work, energy and carbon — and its AI assistant, Herman, answers questions about your buildings in plain English. HermanWa tracks obligations including fire risk assessments and fire door checks, Building Safety Act duties, Legionella (ACOP L8), EICR, gas safety and EPC in the UK, and SCDF fire certificates, Periodic Facade and Structural Inspections, lift permits and Green Mark in Singapore. Directors can check their exposure with the free Director's Risk Check.