A little confused by conveyancer's wording

pinkteapot

What you want is to have buildings insurance from exchange of contracts, which isn't necessarily the same day as the day you sign the contract (ask your solicitor when exchange is).

Don't bother with contents insurance; no point paying for that from exchange. Just take out buildings insurance and tell the insurer you'll call on completion day to add contents insurance.

In terms of how much buildings insurance you need, don't take it out for the purchase price. You need to insure for the cost of rebuilding the property which will be nowhere near the price you are paying, as you are paying for land as well as the property. If you had a survey done, this would normally include an estimated rebuild cost so you can get insurance for this amount (or slightly more for peace of mind).

We have our insurance with Axa and they were happy to do buildings from exchange. Might be worth a call.

Flyboy152

Grimbal wrote: »

You seem to have the monetary side sorted out, so that's good. Might be worth checking the funds have made it over there all ok though.

More & more people are choosing to insure their new property from exchange. It's at this point that you are committed to buy the house. The house might be burnt to the ground, but you still would have to proceed with the purchase. It could be argued that the vendor needs to hand over the property in the same state at completion as at exchange, but I guess it's always better to be over-insured than under ! For the sake of a few weeks worth of buildings insurance, it's worth it I think

This contract exchange not completion. The monies are not transferred until completion. The draft completion statement is effectively a bill, for the sale of the house. It spells out all the costs and calculates the deposit and the balance owed to the seller. The deposit can be paid by cheque, rather than CHAPS/BACS (no need for unnecessary expense).

Insurance will on risk at the point of exchange of contracts. If the exchange does not happen, the policy will remain in proposal, until it does go ahead. If it doesn't happen,you must inform the insurance company though, they will not want to cover a property that someone else is responsible for. The mortgage lender will insist that you have the property insured at exchange as well.

Flyboy152

angelaloveschocolate wrote: »

I previously worked in a mortgage office for a building society, 15years ago, and even then it was standard practice to have buildings insurance from exchange of contracts. Indeed I clearly remember a client's house burning to the ground between exchange and completion. Thankfully she had taken ins with the society as part of her mortgage deal. Unless things have changed buildings insurance is compulsary from exchange, and even if its not would'nt you rather have it for the peace of mind?

That can be a blessing in disguise. It means that the house can be re-built to the new owner's specifications (within limits) and everything will be brand new. None of that, "the previous owner left the house in a right state." It also means the house won't be stuck in a chain either.

Flyboy152

DarkMuppet wrote: »

Cheers for the replies everyone. I want to get the insurance in place as soon as possible, so that's why I've been phoning insurance companies to see if I could have it in place for when we sign for the house.

Just to get this straight then, am I right in thinking that the companies I've talked with have been incorrect in saying that they can't do anything until after we've signed then ? Grrr!

If that's the case, then I should find someone else that is willing to have a policy in place ready for the exchange ? (I'm assuming that as long as the money is all there, then the exchange could go ahead on Friday ?

Thanks again.

I thnk either they, or you, are missing something in the translation. Most insurance comapnies will automatically assume the risk at the point of exchange; having a policy ready and waiting.

Flyboy152

G_M wrote: »

Just get quotes from insurers for the property for the expected date of Exchange. You can do this online or by phone. Most standard insurers have simple criteria for quotes so don't go into detail on ownership - as soon as you do, you become non-standard.

Take the quote + the draft policy document (you can usually download this from their website) to show your solicitor.

Most onliune quotes will be valid for 30 days. Select your preferred insurer, then on the day of Exchange, as soon as your solicitor says he's exchanged, ring or log on and activate the insurance.

It is almost universally accepted by most insurers that people move home. They have processes to cope with that.

If, though, you do not tell your insurer that you don't own the property yet and don't tell them of the exchange date, how will they know when to put the policy on risk?

Flyboy152

flora48 wrote: »

I had no problem getting insurance from the date of exchange. It seems to be recommended practice for reasons listed above. You can sign a contract but exchange may be sometime away. I signed Aug 20th and exchange was Nov 4th.

Sorry, do you mean exchange or completion?

evoke

I think he/she means exchange. I, too, have signed the Agreement but exchange is still some way away. The solicitors hold on to the signed Agreement until you instruct them to exhange.

flora48

Yes I signed Aug 20, exchange was Nov 4th and completion was Dec 14th! A loooong, looooong story.

DarkMuppet

All sorted, cheers everyone for their advice.

We exchanged yesterday and have the insurance up and running. Completion is set for next Friday. Can't wait!!

G_M

Flyboy152 wrote: »

It is almost universally accepted by most insurers that people move home. They have processes to cope with that.

If, though, you do not tell your insurer that you don't own the property yet and don't tell them of the exchange date, how will they know when to put the policy on risk?

Sorry. I sometimes forget that one needs to spell things out in CAPITAL LETTERS.

Add steps as follows to my earlier post:
1) Once your solicitor has confirmed the date of Exchange, contact the insurer you've pre-selected and pay for the policy, confirming with them the start date for the policy
2) Check that a few days later a letter arrives from the insurer.
3) If no letter arrives, phone them (the insurers that is, for the avoidance of doubt) and ask why
4) if the letter DOES arrive, open it
5 Read the policy document, and check the dates match your Exchange date
6) if they have got the date wrong, ring them upa nd.....

oh god I'm putting myself to sleep!