The Remediation Programme Insurance Survey included buildings in the Cladding Safety Scheme, Building Safety Fund, Responsible Actors Scheme, social housing remediation programmes and the Welsh Building Safety Fund.
Buildings with flammable cladding or other external defects had an average insurance rate of 0.14%, compared with 0.09% where defects were not reported. Around 3,200 homes faced annual premiums above £1,800, while a small number of buildings reported fire or water excesses of at least £1 million.
The findings support our view that remediation is essential to reduce costs. Changes to commissions and fees cannot address the underlying building safety risks.
Reform must address the causes of rising premiums
The latest research follows a 2022 Financial Conduct Authority investigation which found that average insurance prices for high-rise buildings had risen by 125% in the years after the Grenfell Tower fire. Propertymark has previously highlighted the effect of reduced competition within the market. Even before Grenfell, fewer than 20 insurers provided cover for mid and high-rise residential buildings, with further providers subsequently reducing their exposure or withdrawing.
We welcomed FCA rules introduced from December 2023 which defined leaseholders as customers and required firms to consider their interests, demonstrate fair value, and disclose important information about pricing and commissions. However, leaseholders have historically had little involvement in selecting the policy or challenging the amount passed on to them. It is vital residents are given a meaningful opportunity to challenge insurance costs and suggest alternative providers where they believe the building is being overcharged.
Insurance uncertainty is blocking property sales
Research published in our 2026 Leasehold: still a life sentence? report found that 62% of Propertymark members working as managing agents had seen premiums increase as a direct result of the building safety crisis. Of those who had managed buildings after defects were remediated, 60% said premiums did not change, while only 6% reported that they fell to a level reflecting the removal of the building safety risk.
The consequences extend beyond the annual service charge. More than half of Propertymark members who had experienced difficulties selling flats with cladding said the main barrier was securing a mortgage, rather than buyers simply refusing to purchase a property with an unresolved defect. Lenders need certainty about the safety of the building, the timing and funding of remediation, and the buyer’s exposure to future costs.
High premiums, large excesses and uncertainty over future charges can reduce affordability, weaken lender confidence and increase the risk of transactions being delayed or falling through. Better information is essential, but transparency alone will not reopen the market if the underlying risk remains or premiums fail to respond after it has been removed.
Evidence must now lead to action
MHCLG has said it will continue monitoring insurance costs across remediation programmes and will publish updated findings as more information becomes available.
Propertymark continues to call for remediation to be completed more quickly, with clear responsibility for funding and firm deadlines for action. Insurers must be required to reassess policies promptly when work is completed and explain where premiums remain high despite the removal of identified defects.
