What Is A Right To Manage Company?
A Right to Manage company is a group of tenants or leaseholders. They generally live in a block of flats, and have the legal right to become the managers of the building they live in. The right to manage process often means that the landlord or owner is forced to transfer management. For an RTM company to gain these rights, it must be set up as a company limited by a guarantee. This means that leaseholders or tenants must be members rather than shareholders.
The Right to Manage company would not only take over the maintenance and repairs on the building but would also be responsible for legal work and building insurance for the block of flats. It’s recommended Directors’ and Officer’s liability insurance is taken out, in case one of the Directors of the RTM makes a decision that other tenants disagree with resulting in a claim which would potentially be bought against the individual who made the decision.
Who is in an RTM company?
An RTM is made up of leaseholders in the block of flats, who own or rent one of the flats within the building. They generally have more of a vested interest in the running and maintenance of the building because they have to live in it day to day. This will also mean that they want a comprehensive block of flats insurance policy in place so that they’re protected should there be an accident or damage to the property. If a tenant leaves the property, the right to manage process dictates that they also leave the RTM company.
Although Right to Manage companies are normally set up to separate the landlord from the running of the property, the landlord can also be in the RTM. Some things cannot be run by an RTM. For example, ground rent must be collected by the landlord. Also, RTMs must follow the correct right to manage guidance. If covenants are broken by tenants, it is the RTM company’s job to report this to the landlord as only they can evict tenants.
How we can help
At Flats Direct, we can give right to manage guidance in terms of recommending help for how to set up. Most importantly, we can source a block of flats insurance solution that works for you. Our expert team discuss each customer’s needs and help to organise everything from directors’ and officers’ liability insurance to engineering inspections and breakdown cover for your lifts. The right to manage process means that you can take control of your building and ensure that everyone is happy in a block of flats and a huge part of this is arranging a flats insurance policy when you need it most.
To get a quote or for advice on building insurance for blocks of flats, contact us at Flats Direct. We offer block of flats insurance and right to manage guidance with no hidden fees or charges from a wide range of top insurers. To discuss your block of flats insurance cover, call us on 0800 731 6242 or email us at info@flatsdirect-uk.com.