Help and advise needed re indemity insurance

perc

Hello

I am currently going through buying a house. About 2 weeks ago my solicitor called me up and said that there is a letter of indemity on the property but that she did not know what work it related to. The vendors intially denied any knowledge of this.

Through a bit of research I have found out the the garage had been converted in 1987 into a dining room, but this has both planning permission and building regulation approval.

However in 1970 the property was extended at the rear, adding in a kitchen and bedrooms above. Although planning permission was obtained, there is no building regulations approvals as these were not brought in until 1974.

The estate agent is saying that building regs cannot not be obtained as the work was carried out before 1974, and the the indemity policy covers any possible faults in the building works.

I have spoken with a structual engineer who said that to fully inspect the property he would have to make a hole about 1 metre deeps and about 18" square to inspect the foundations.

I am totally confused as to why it has an indemity policy to cover the works carried out in 1970 if these do not need building regs. I have bought properties in the past which have old extentions and have never come up against anything like this before.

Can anyone shed any light on this at all for me?

Many thanks in advance .....

silvercar

indemnity policies cover the loss in value between the property with and without the necessary approvals. They probably took out the policy because they or their solicitor was very cautious. Remember that the extension was newer when the policy was taken out.

Your EA is right, to get a building regs certificate now, the current regulations would be applied - near impossible for an extension built that long ago.

Your survey should show if the extension is in good condition. Bear in mind that the indemnity policy will not cover you for putting right work that was done incorrectly. For an extension done that long ago I would have thought that ordinary household building insurance would suffice if a problem like subsidence appeared now.

perc

silvercar wrote:

indemnity policies cover the loss in value between the property with and without the necessary approvals. They probably took out the policy because they or their solicitor was very cautious. Remember that the extension was newer when the policy was taken out.

Your EA is right, to get a building regs certificate now, the current regulations would be applied - near impossible for an extension built that long ago.

Your survey should show if the extension is in good condition. Bear in mind that the indemnity policy will not cover you for putting right work that was done incorrectly. For an extension done that long ago I would have thought that ordinary household building insurance would suffice if a problem like subsidence appeared now.

Thank you for this. What particularly worries us is shoddy electric and building work, more then subsidence. Is there any way that the electrics can be checked on the house prior to the purchase as it does seem to not be well done (ie wires to thermostat exposes etc).

Bun

It may sound shifty that they denied knowledge, but we had to continue an existing indemnity policy when we bought our flat re a discrepancy in our lease, and we were told not to disclose it ourselves if we came to sell.

perc

Bun wrote:

It may sound shifty that they denied knowledge, but we had to continue an existing indemnity policy when we bought our flat re a discrepancy in our lease, and we were told not to disclose it ourselves if we came to sell.

What were the reason for non disclosure?

td

We have a similar thing with the property we're buying although it wasn't quite as long ago. I found the local council very very helpful and have started the building regs procedure (as it's for a garage conversion so it's not planning permission). I warn you though not to ring your council up and mention the property by name as this puts them on what's called notice and then indemnity insurance is difficult to get. You could ring the council up and make a general enquiry about the length of time it's been done as I think the planning lady mentioned after a certain time nothing can be done.

Solicitors seem to have gone indemnity insurance mad - I wasn't willing to accept just indemnity insurance as we put a bid on a 4 bed house which without the buildings regs in place it's not officially. Building regs only take less than a week - but yours sounds like planning to me.

td