East London leaseholder hit by 180% buildings insurance hike, despite having no cladding or fire safety issues

An east London leaseholder hit by a buildings insurance charge increase of more than 180% has queried where the additional costs have come from, given his block has no cladding or fire safety issues.

Mohammed A Rahman, known colloquially as Gaz, has owned his flat in Vollasky House in Tower Hamlets for years. He lived there himself for most of his life, before moving in to a new property in 2011 due to having children, and currently rents the apartment out.

Since 2004, Mr Rahman said he has been battling with Tower Hamlets Community Housing (THCH), which manages the building, over ongoing issues with his roof.

Following work done to the structure between 2004 and 2006, Mr Rahman said the flat has suffered from regular flooding, which has yet to be properly resolved.

Against this backdrop, Mr Rahman told LondonWorld he received a letter from THCH detailing an increase to his building insurance payment for 2023/24.

In it, THCH says his charge will be hiked from £376.88 a year to £1,081.99, a rise of £705.11, or 187%.

The letter states the sharp increase in costs is due to “external environmental factors, like the pandemic and rising inflation, that over the years has meant that insurance premiums have not kept pace with the number of claims”.

However, Mr Rahman said he doubts these claims, and that the building has no cladding or fire safety issues.

“If the previous insurance was £370 and it’s gone up to £1,000…the fact is, where’s the cladding? Where’s the fire safety in my building?” he said.

“I have got no cladding, and on top of that, there’s no disrepair and no service.”

He continued: “I totally don’t get any service. There’s no one in the building to service anything. They don’t mop or anything.”

A letter sent to another tenant at Vollasky House, seen by LondonWorld, stipulates a similar increase, from £251.26 to £721.35.

Asked whether the sharp rise will be passed on to his tenants, Mr Rahman said so far he has been able to avoid any rent increases, despite hikes in service charges and other costs by THCH. This was confirmed to LondonWorld by the current tenant.

Given the drastic increase to his buildings insurance, which is due to be paid next September, Mr Rahman said he will have to pass on some of the cost to stay afloat.

“At the moment I have to absorb it. I’m not going to make my tenants pay because it’s not their fault,” he said.

He added he is currently not making any money on his property, and that it has “been hard” to manage the rising costs.

LondonWorld put the buildings insurance increase to THCH, and in response, executive director of operations Mandeep Bhogil said: “We understand that cost increases can be challenging for residents, especially during these times. The building insurance charge is set directly by insurers and beyond our control. The increase is based on factors like risk, coverage requirements, and market contraction, which is being experienced across the social housing sector.

“Building insurance ensures protection from significant damages caused by events like fires or floods. Leaseholders are required to pay for insurance as per their lease agreement. All leaseholder service charges reflect actual costs of providing services, and any increases are due to rising delivery expenses.

“To support leaseholders, we’ve offered a payment plan to spread the costs over the year. We encourage residents to contact our customer service team to discuss concerns and any questions about insurance premiums and service charges.”

LondonWorld approached Protector, the building insurance provider for Vollasky House, for comment but has not received a response at the time of publication.

THCH residents, including Mr Rahman, have previously called for a voice in the housing association’s potential merger with another local housing organisation, Poplar HARCA, due to concerns over their joint finances and quality of their services.

A decision on whether the merger will go ahead is due to be announced this autumn.