A spokesman for the Association of British Insurers confirmed a homeowner is legally obliged to continue paying their mortgage, even if the flat burns down.
Their buildings insurance, which is a legal requirement for everybody who has a mortgage, only covers the rebuild costs of the property.
Mr Payne said it is likely to take about two years to rebuild the River Heights block of flats.
But he said many residents have told him that they have no intention of returning because it would bring back such terrible memories.
Our insurance would pay our mortgage if something like this happened.
Why would this insurance be required if you have a mortgage but not cover