Shared ownership buildings insurance

Owning your home is definitely a better proposition than renting. However, if you cannot afford to buy a house or flat at this time, there is the option of shared ownership. As co-proprietor, you will also have responsibilities such as shared ownership buildings insurance. We explain why you need this type of protection.

Purpose of insurance

Under shared ownership arrangement, you can buy a portion of a flat or condominium depending on what you can afford. The rent will be adjusted according to your share of the property which can be anywhere from 25% to 75%. However, as co-proprietor, you are obligated to take out shared ownership buildings insurance. This is an insurance type that is mandatory so you can protect your investment and home. It also serves to protect the assets of the building society.

  • Buying insurance

In typical situations, the building society will initiate and take care of shared ownership buildings insurance. You will be informed how much you need to pay. The good news is, you will probably get it at a better price because the administrators have special deals with insurance companies. Hence, savings will be passed on to you in the form of lower insurance premiums.

There are other cases though where the building society has to insure the entire building. In this case, verify with them to see that you are not paying double for insurance and read the fine print of your contract to see where you have to step in. If insurance is already included, the building society might charge you a higher service fee which will already include shared ownership buildings insurance.

  • Home contents insurance

It is also your duty to insure the contents of your abode and although this is not mandatory in your present contract with the buildings administrator, it is in your best interest to protect your belongings in cases of unforeseen events such as fires, theft or vandalism, amongst others.

Other costs

Apart from shared ownership buildings insurance costs, as an owner, you are responsible for paying the service fee to the building administrators. This money will go to pay for the repair and maintenance of common areas in the building such as the roof, hallways, lift and others. It will also cover operating costs such as security, electricity and water.

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