In a letter to the FCA, Gove has requested initial feedback within three months and for them to work in close consultation with the Competition Markets Authority.
Leaseholders
The request relates to the number of leaseholders who face rapidly escalating building insurance premiums on high and medium-rise blocks of flats with some increases of 100 per cent year on year.
Gove is addressing building safety as a top priority since taking up his position, stating it was clear that the insurance market is failing some leaseholders.
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The market lacks transparency and there is currently no useful data to explain the rationale behind the increasing premiums charged by insurers and the conditions associated with the cover. The role and remuneration of brokers, managing agents and freeholders are also unclear.
Affordable buildings insurance
To provide a more affordable marketplace for buildings insurance that offers cover for those who live in flats and other multiple-occupancy buildings, Gove is looking for detail on the scale and potential causes of the problem and what can be done.
The review will look to shed light on the underlying causes of year-on-year price increases and assess the causes of the marked restriction in coverage available for multiple occupancy buildings. The aim is then to make practical recommendations for measures that industry, the Government and regulators could take to achieve the goal of widely available and affordable cover.
