This case study is an anonymised composite based on publicly reported commercial insurance claim patterns. It is not actual Apex client data and does not constitute legal or insurance advice. Names, locations and identifying details have been changed. Apex Insurance Brokers Limited is authorised and regulated by the Financial Conduct Authority, FRN 724952.
A private buy-to-let (BTL) landlord owning a portfolio of fourteen residential properties across the Bath, Bristol and Swindon area, held in a personal capacity by a single individual. Total annual rental income approximately £210,000. The portfolio is a mix of Victorian terraced family houses, modern flats and one Edwardian three-storey townhouse converted to a single HMO with five letting rooms. Insurance is placed under a portfolio landlord policy with a commercial-grade insurer, including property owners liability cover at £5m and a building section with appropriate sums insured.
A tenant at the Edwardian HMO fell from a first-floor landing onto the ground-floor hallway, sustaining serious head injuries and a fractured spine. The fall occurred in the early hours of the morning. Investigation by the local authority’s housing standards team established that the timber balustrade originally fitted to the landing had been removed by a previous contractor undertaking decorative works approximately four months earlier and had not been reinstated. The temporary safety barrier installed by the contractor (a length of fixed timber rail) had been removed by the contractor on completion of the works but the original balustrade had not been refitted because a specialist joinery component was on order from a supplier and the part had not yet been delivered. The landing was therefore unprotected at the relevant edge during the four-month period.
The contractor had emailed the landlord twice during the four-month period highlighting that the balustrade reinstatement was outstanding and requesting authorisation to install a temporary metal rail in the interim. The landlord had replied that he would inspect the property at his next quarterly inspection (scheduled the month after the accident) and would consider the interim options at that point. The tenants had separately raised concerns with the landlord via the property management agent about the absence of the balustrade on three occasions during the four-month period; the agent had passed these concerns to the landlord by email without specific action being taken.
The local authority issued an Improvement Notice under the Housing Act 2004 following the accident, requiring immediate installation of compliant balustrading and a full Housing Health and Safety Rating System (HHSRS) assessment of the property. The landlord engaged a contractor to install temporary metal balustrading within forty-eight hours of the Improvement Notice.
The tenant’s claim was intimated through specialist personal injury solicitors approximately eight months after the accident. Pleaded quantum was £640,000: special damages for treatment, care and rehabilitation £140,000, loss of earnings during a sixteen-month recovery period and reduced earning capacity for the future £180,000, future care and home adaptation costs £140,000, and general damages for pain, suffering and loss of amenity based on the JC Guidelines tariff for moderately severe head injury and spinal injury at £180,000.
The pleading advanced liability under the Occupiers’ Liability Act 1957 section 2, the Defective Premises Act 1972 sections 1 and 4, and the implied terms of the tenancy agreement requiring the landlord to maintain the structure and exterior of the property in a state of repair and the common parts in a state fit for the tenant’s intended use. The pleading also addressed the landlord’s specific duty under section 4 of the DPA 1972 in respect of relevant defects of which the landlord had actual or constructive knowledge.
A parallel local authority engagement under the Housing Act 2004 and the HHSRS process continued separately, with the property being rated as containing a Category 1 hazard at the date of the accident.
The portfolio landlord policy responded under the property owners liability section. Notification was made within seven working days of the local authority’s Improvement Notice (predating the formal solicitor’s letter). The insurer engaged a personal injury defence specialist and an expert chartered surveyor to advise on the property condition and the landlord’s response.
The defence position was structurally difficult. The landlord had received express written notice from both the contractor and the property management agent that the balustrade was missing and that interim safety measures were warranted; the response had been to defer action to the next scheduled inspection. The Defective Premises Act 1972 section 4 duty arises where the landlord has actual or constructive knowledge of a relevant defect, and the contemporaneous correspondence established actual knowledge beyond reasonable dispute.
The insurer’s position, taken in consultation with the landlord, was that liability was substantially conceded and that the focus of the defence should be on quantum and on potential contributory negligence by the tenant (who had been walking the landing in the early hours of the morning in low-light conditions and may have had a low blood-alcohol level at the time of the accident, although the toxicology was not definitively established).
The matter settled at mediation approximately fourteen months after the accident at £420,000 plus claimants’ costs of £85,000. The settlement reflected an assessment of approximately 25% contributory negligence on the part of the tenant, balanced against the landlord’s clear knowledge of the defect and the period over which it had remained unaddressed.
Defence costs across the matter totalled approximately £42,000.
The portfolio landlord policy renewed with a 28% premium increase across the policy with the property owners liability rated specifically for the HMO. The portfolio’s HMO licence under the Housing Act 2004 Part 2 licensing regime was reviewed by the local authority and was renewed subject to additional conditions on inspection frequency and reporting. The landlord engaged a professional managing agent for the HMO on a substantive (not letting-only) basis, replacing the previous limited engagement.
The local authority took no further enforcement action beyond the Improvement Notice. The Housing Ombudsman service was not engaged (the tenant’s principal route was the personal injury claim rather than a service complaint).
The landlord subsequently restructured the portfolio ownership into a limited company vehicle, partly for tax reasons and partly to limit personal exposure on future incidents, with appropriate adjustments to the insurance arrangement to reflect the new corporate ownership structure.
BTL and HMO landlord exposure is one of the most underestimated risk profiles in the residential property sector. First, the Defective Premises Act 1972 section 4 duty creates a continuing landlord liability for any relevant defect of which the landlord has actual or constructive knowledge — written notice from a tenant, contractor or agent establishes knowledge, and inaction over an extended period substantially weakens any defence. Second, the Housing Act 2004 Part 2 HMO licensing regime imposes specific structural and management duties on the licensed person; the licence conditions should be embedded in the management practice, not treated as a one-off compliance event. Third, the Homes (Fitness for Human Habitation) Act 2018 has strengthened tenants’ direct claim rights against landlords and the implied terms of tenancy agreements now create a more robust contractual route than was historically the case. Fourth, property owners liability cover at £5m is increasingly the appropriate floor for any HMO; £2m is too low for any incident involving serious injury. Fifth, the management agent’s role should be defined in writing and the agent’s reports should be acted on within a defined timescale, with escalation procedures for safety-related issues.
We would have reviewed the property owners liability limit at the previous renewal against the HMO exposure profile, and would have specifically discussed the management practice in respect of contractor-reported defects. The contractor’s two emails to the landlord during the four-month period were the central factual basis for the section 4 DPA 1972 liability, and a documented response protocol would have materially changed the defence position. At notification, we would have managed the engagement with the local authority alongside the insurer’s defence process, ensuring that the Improvement Notice response and the litigation defence were aligned and that the local authority engagement did not generate further evidential exposure for the civil claim.
For the underlying cover, see our Property owners insurance hub.
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