Frequently asked questions

Since the late 1990s, large landlords and brokers have added secret commissions to insurance premiums. In a 2023 report, the Financial Conduct Authority found that these commissions ranged from 10% to 60% of the premium.

The Financial Conduct Authority also found that most insurance brokers could not justify the level of the commissions charged.

You are likely to have been affected if:

(i) you live in a flat you own (with or without a mortgage)

(ii) you pay for insurance via your service charge (or make a separate payment to your landlord or your landlord’s broker for insurance)

(iii) your building is not owned or managed by the people who live in it.

No. We will ask landlords for these details on your behalf.

If the claim succeeds, we estimate that leaseholders could receive thousands of pounds in compensation.

The amount you may receive will depend on a range of factors including the sort of building you live in, how long you have owned your flat, the extent of the secret commissions, whether we can claim interest and the period for which we are able to claim.

Also, see: “If I win, what is deducted from my compensation?”.

Velitor Law, Balance Legal Capital and Milberg London LLP are partnering up to ensure leaseholders like you get the justice you deserve and the compensation you are entitled to.

Velitor Law is a law firm regulated by the Solicitors Regulation Authority that helps its clients bring claims against powerful institutions that have acted unlawfully. Velitor Law will be the solicitors acting on your behalf and bringing your claim as part of the Leaseholder Action in the courts. For more information about Velitor Law, visit their website here.

Milberg London LLP is a law firm regulated by the Solicitors Regulation Authority that acts for consumer clients in some of the most significant multiparty cases ever to be heard before the English courts.

Due to their expertise in multiparty litigation, Milberg London LLP will provide legal support and advice on the litigation strategy in the Leaseholder Action. For more information about Milberg London LLP, visit their website here.

Balance Legal Capital is a leading litigation funder based in London and will be funding the Leaseholder Action. It provides money to enable groups of people who have been wronged by large corporations and other organisations to bring legal action that they could not afford to bring as individuals.

Balance Legal Capital is a funder member of the Association of Litigation Funders (ALF), the body responsible for the self-regulation of litigation funding in England and Wales. For more information about Balance Legal Capital, visit their website here.

Velitor will act for you on a “no win no fee basis”. There are no upfront costs for joining the claim. You won’t pay Velitor any money as the claim progresses.

If the claim succeeds, then legal fees and expenses will be deducted from your compensation and you will receive the balance.

If the claim does not succeed you will still not pay anything unless you leave the claim early. You do not need to leave the claim if you sell your flat. If you leave the claim early you will have to pay an exit fee.

Also, see: “If I win, what is deducted from my compensation?”.

You do not need to leave the claim if you sell your flat. If you leave the claim early you will have to pay an exit fee.

We can sign most people up without any paperwork based on their address alone.

If you have sold your flat, or we cannot match your address to a landlord, we may need further information. We will write to you separately to obtain that information.

You can still join. We will ask you questions about this when you sign up.

Yes. Provided you have permission you can claim on behalf of a dead relative or someone who lacks mental capacity, for example if they have given you a power of attorney. We will ask you for details of this when you sign up.

Yes, you can still join. We will ask you questions about this when you sign up.

No. Your flat must be in England or Wales.

Yes. The owners of flats in England or Wales can join the claim wherever they live in the world.

Yes. We will need details of each property.

Yes, but we will need some details from you. When you join the claim, please let us know about the service charge dispute.

It doesn’t matter. Your claim will continue.

Yes. We will ask you questions about this when you sign up.

No. In most cases our sign-up process will identify your landlord from your address.

In some cases we will need further information. We will contact you separately.

No, we will obtain this information on your behalf.

Typically claims such as this take several years. The length of the claim will depend on the type of defence put up by landlords and insurance brokers, but we estimate it will take 3 to 5 years to bring your case to a conclusion. This is because we have to work through the English Court system and many procedural steps required by the rules. We will keep you regularly updated.

Yes. Your ‘landlord’ is the owner of the block. They are also known as the freeholder.

If you bought a flat (with or without a mortgage) you are a leaseholder and can join the claim. You can claim for a flat you have sold.

No. A very limited few will not be able to pay compensation and so won’t be pursued. We will only pursue landlords and brokers who can pay compensation.

We will review your building and let you know whether we can progress your claim.

Unfortunately not. The Financial Ombudsman cannot help leaseholders with claims against landlords, insurers or insurance brokers for this type of insurance.

If you win then Velitor will deduct fees and costs from your compensation at the end of the case.

The fees are 40% of your compensation, excluding VAT. The costs are a maximum of £120.

For example, if your compensation is £3,000 there would be a maximum deduction of £1,560 including VAT. You would then receive a minimum of £1,440.

But it could be that you will recover more. If the landlords lose they will normally be required to pay some of your costs. If that happens you will keep more of your money because Velitor will reduce its 40% fee to reflect any costs recovered from the landlords.

Your actual compensation will depend on a range of factors, including how long you have owned your flat, the overall cost of insurance and how much commission your freeholder has received.

In some leases there may be a provision that may entitle the landlord to recover certain legal costs from leaseholders via the service charge.

Velitor does not believe these provisions can be legally enforced by landlords. If your claim is issued, then Velitor will take steps to protect you from landlords trying to pass on their legal costs to you.