Is insurance picking up the bill for out-of-date building regulations?

Allison Whittington, head of housing at Zurich, discusses the hazards of modern properties and how insurers are getting involved.

In the recent months, we have seen an alarming increase in the number of high-profile fires in both commercial and residential properties up and down the UK. These fires happened in both high and low rise buildings, some still under construction and others already occupied. Examples include a Barking building which caught fire after a barbeque on a wooden balcony and a recent fire in student accommodation in Bolton accelerated by highly combustible cladding.

These examples have two things in common. Firstly, they are all classified under what we call ‘modern methods of construction’ (MMC) and, secondly, they are all compliant with current building regulations. This highlights that building regulations are out of date and not fit for purpose when current construction methods are taken into consideration.

MMC is a collective term used to describe a variety of modern building practices that are different from more traditional brick and block type construction techniques. Today, many domestic and commercial large-scale new developments are built using some elements of MMC. This includes manufacturing techniques such as steel or pre-cast concrete frames, panellised units, modular and volumetric buildings, structured insulated panels and timber frames.


The potential benefits of innovation in construction can be far reaching. However, many popular MMC solutions add risks and reduce resilience when compared to more traditional builds, both during construction and throughout a building’s lifetime.

The inappropriate use of materials arising from a focus on cost and energy performance is often without due regard to the form and function of those materials, their longevity and the consequences of introducing them in combination into a structure without taking into account the size of the structure to which it relates.

The Government, Homes England and local authorities have a responsibility to not only promote the range of benefits associated with MMC but also ensure that the regulatory system, associated guidance, and industry standards are fit for purpose, reflective of, and relevant to the construction systems being developed and implemented.

Regulatory change is essential to support the construction industry. Current building, housing and fire safety legislation, and associated guidance, is too fragmented and inconsistent with building regulation approval. It is also subject to commercial pressures and, therefore, open to potential differences in the quality of services provided for approval and inspection of building works.

Updated, robust and clear regulatory requirements, together with improved industry awareness and standards, are essential to ensure a safe and resilient built environment, as well as enabling fair competition across the entire construction industry.


We have actively engaged a range of parliamentary stakeholders and will be calling on the next Government to prioritise the following thematic areas as part of their housebuilding policy:

  • Increase understanding, awareness and education of the role of MMC in housebuilding across both the construction sector and the general public.
  • Improve the resilience of the built environment by ensuring effective building regulations and learning lessons from past events.
  • Understand how MMC work best and can be effectively scaled based on an expanded evidence base.

Within these key thematic areas, we have a range of specific policy asks. In particular, we are calling for the ban on combustible materials to be extended to cover the entire external envelope of both residential and non-residential buildings of any height.

We believe that the number of claims involving MMC is only going to rise. Ultimately, we are calling for greater awareness of the risks associated with these building methods so that they can be properly managed or eliminated where possible. We also need a wider and deeper understanding within the construction supply chain of how these properties are put together, how they behave in the events of fire, flood and escape of water, and how we, as insurers, may best remediate damage when it occurs.

MMC when not managed and understood properly can pose a significant risk and become a real burden for insurers and policy holders. It’s vital to ensure that buildings are constructed to the right standard and then maintained and lived in appropriately.

Insurers are not regulators and we are not in a position to enforce building regulations or make any changes to them. We can, however, use our data and claims experience to demonstrate any gaps in property resilience to the Government and other stakeholders.


This blog was written for Insurance Post on 2nd January 2020. The original source of this article can be found here.