Chesterfield leaseholders at apartment block left with over £1 million flooding bill due to insurance shortfall

Twenty-one of the homeowners on the ground floor of Chesterfield’s Foundry flats are living in limbo, unable to return to their homes two months after the October 20 deluge.

After a month of silence following the October floods a property management company with responsibility for the flats finally dropped the bombshell that there was “no additional flood insurance coverage” to pay for repairs.

Instead, the cost of refitting the rotting homes, including accommodation costs for residents, would be covered by the service charge paid by flat owners.

Since then, seething Foundry residents – who estimate the repairs will cost upwards of £1 million – have been requesting copies of the building’s insurance documents and contracts from Watson property management since October.

On November 17 Watson sent homeowners a letter informing them of the insurance shortfall.

In it, the company says it has “flash flood” insurance worth £60,000 which it will use to strip out and dry the building.

However, in the letter Watson adds: “Unfortunately, there is no additional flood insurance coverage, meaning any required remedial works, including alternative accommodation costs, will be covered by the service charge.

“Although the exact cost of the refit is currently unknown, we are in the process of obtaining quotes and will promptly update everyone as soon as we have the necessary information.

"It's important to emphasise that work will proceed only when funds are readily available.”

Foundry homeowner Phoebe Sellars, 24, paid £100,000 for her one-bedroom, ground floor flat in 2020, but has been living with her parents in Lincolnshire since October 20.

She says residents just want “help” and answers from Watson, adding: "We're two months on, my home is rotting. It’s uninhabitable, I’ve lost everything I own.

"You’re told to buy a house because it gives you some security in life and I worked really hard and this was everything.

"It was nice, I did it up really nicely – I put a lot of money time and effort into it and I loved it, It was my home. I thought I was setting myself up.

"I don’t know where it leaves me and I don’t know what the future looks like, it’s really scary.”

Crucially, Phoebe says none of the Foundry residents were aware that the flood insurance fund amounted to just £60,000.

While requests for copies of the insurance documents and the contract between Watson and the leaseholders have been met with silence.

Phoebe’s father Chris Sellars said: “The big point is, they don’t appear to have told anybody.

"Something like 18 of these 43 apartments have transacted since 2017 and my understanding is there probably hasn’t been proper flood insurance since.

"In each of those transactions they just wouldn’t have bought it - you wouldn’t buy it and you wouldn’t get a mortgage on it.

"I think as a matter of common decency it’s a disgrace that this company has not engaged with the people who have lost their homes.

"When Phoebe bought her flat nobody told her it wasn’t insured for floods but the biggest issue is that Watsons need to be providing the documentation.

"They should probably be resigning from their role because they’re conflicted. It’s not appropriate for them to continue managing the building in these circumstances.

"We want them to show us why there is no insurance and why they didn’t tell us.

Phoebe, who ironically works in commercial property finance, added: “We’re two months on but we’ve not just sprung this on them.

"We just want them to help us and tell us how we’ve ended up here. Our homes are just sat rotting.”

Watson property management has been approached for comment.