Last week Michael Gove, Secretary of State for Levelling Up, Housing & Communities, wrote to the chief executive of the British Insurance Brokers’ Association. He stated that following findings of the Financial Conduct Authority, broker commissions for buildings insurance in multiple-occupancy residential buildings had reached £159m between 2019 and 2021, and that an additional £80m had been paid to third parties.
Mr Gove stated that during a cost-of-living crisis which already stretches leaseholders, these sorts of practices are unacceptable. Mr Gove wrote that the Association have had sufficient warning in relation to their “unjustified” practices, and he invites proposals on how they will become more transparent and competitive. It remains to be seen whether the government will take action on commissions on insurance contracts, and whether they will ban them altogether, as Mr Gove threatens. Mr Gove has given the Association one month to respond.
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