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We look at some of the most common questions posed to our underwriters.

Q: Are you still receiving enquiries relating to historic rent charges, following the introduction of the Leasehold and Freehold Reform Act 2024 (LFRA)? 

A: We certainly are. Our historic rent charge policy provides cover for a situation where a missing rent charge owner reappears and demands payment of any back rent that is still owed prior to the insured’s ownership and threatens to take further action if it’s not paid. Despite the reforms introduced by the LFRA, this remains a risk for buyers purchasing a property affected by an outstanding, historic rent charge.

The LFRA did however introduce some important changes to the procedures that historic rent charge owners are permitted to take when rent is outstanding. Firstly, they are now required to give the homeowner 30 days’ notice demanding payment of the arrears, before taking any further action. Also, they can no longer use the provisions of section 121 of the Law of Property Act 1925, to register a statutory rent charge lease against the property’s title, or exercise a statutory right to take possession of a property, simply because a rent charge payment is outstanding. The wording of some rent charges in the original deed explicitly contain a right of re-entry to the property due to non-payment. In these cases, the rent charge owner can still take this action, but only if the rent demanded remains unpaid after the 30 days’ notice period.

In response to these changes, we have updated our policy wording to remove any reference to a rent charge owner attempting to register a statutory rent charge lease against the title to the property. 

It’s worth noting that our modern estate rent charge policy remains unaltered. Estate rent charges, typically imposed by developers on modern developments to ensure individual property owners pay a regular contribution towards the maintenance of communal and landscaped areas, were excluded from the LFRS. Which means the statutory remedies for failure to pay still include the right to take possession, or to grant a lease of the property.

Premiums for our historic rent charge policy start at just £22 for a policy limit of £100,000. You can find all our Outstanding Charges policies here.