when to start buildings insurance. exchange or completion??

wrightstar

I am so confused.
I have exchanged. Do i need to get buildings insurance now or start it from completion date.
I dont actually own the house yet so why would i insure it now before completion?
Surely its still insured by the builders

SquatNow

Technically from the completion date - the point that you become liable.

Personally I'de start it a short time before. How long away is copletion, and which builder?

tbs624

Buildings insurance should be in place from *exchange* - your solicitor should have told you this.

Jonbvn

I would second the post above. You must get insurance from the date of exchnage.

Richard_Webster

Normally the advice would be to insure from exchange, particularly if you are selling another property. The situation with new builds can be different and OP should ask his solicitor.

(This is, by the way, a typical sort of question that a solicitor would be asked, and I am continually amazed that people come on this forum to ask this kind of thing when they should ask their solicitors - that's what the solicitor is there to do.)

wrightstar

Unfortunately we have a strange solicitor that doesn't like to speak to us on the phone, says he has no time for emails or appointments.But we are stuck with him!!!
In his paper work it says from exchange, but o just wanted to double to check as he has already proved to be wrong on a few occasions.
I didnt understand why we would need to insure a property that doesnt belong to us as yet.
Its not officially ours until we complete, surely its still insured by the builders until the day of completion??

Ian_Griffiths_Halifax

It's normal to insure from exchange of contracts because you are committed to buying the house and they are obliged to sell the house.

In some circumstances the seller may not have insurance on the building and so, if the house were destroyed, you would be committed to buying the pile of rubble.

If it's insured, then you are covered. Would you like to rely on the seller having insurance?

System

My mortgage lender insisted that insurance was in place at exchange. We had to provide proof to our solicitor so that he could confirm it to the mortgage lender before they would agree to release funds.

Richard_Webster

!!!!!! wrote: »

My mortgage lender insisted that insurance was in place at exchange. We had to provide proof to our solicitor so that he could confirm it to the mortgage lender before they would agree to release funds.

Yes, that's another reason why you have to arrange insurance before completion.

There is also the point that very occasionally there is a problem getting insurance. I had a client recently who bought a house. I told him to arrange the insurance before exchange so that when we exchanged he could call the insurer and have it put on risk. He didn't, and left it until completion, and found great difficulty insuring because the insurance companies' internal records showed that the particular house had suffered subsidence damage.

None of this came out prior to exchange of contracts from legal enquiries etc - it would normally - but it could be concealed and if a property had changed hands a number of times the present seller might not have known about it. Had he checked before exchange then the information would have come to light and we would have advised him not to proceed, at least until there was a satisfactory clarification of the position, structural engineeer's certificates produced etc. and insurance could be arranged at normal rates, rather than extortionately high rate he is now paying - all because he didn't bother to read clear advice.

wrightstar

thanks for the advice.
I'll get on it today, cant afford the risk!!!