FTB - When do I insure? + General advice

Gompo

Hi,

Hopefully going to buy/complete/whatever my house in the next month - when do I need to get insurance and how do I go about it exactly?

I've got quotes, but there are details that will change in the next few weeks. My address is different (obviously got quotes for the house I'm buying's address, but correspondence would need to come to current address else I wouldnt get it(?)), the 'occcupied during day/night' would change and suchlike - how do I go about that?

With regards to my initial question, my solicitor has been on holiday (great timing) but back next week. I have an appointment to see her which I think is just to talk through the contracts and searches etc. I think that's all been done now. I presume I'd then set up a potential date to exchange contracts and complete? Do I just need to get insurance before we 'complete' or exchange or what..? There's no chain, just the vendors (three brothers) and myself.

Cheers, Greg.

josievg

You need to take buildings insurance from exchange. You can get quotes now and then just give the insurer a call on the day you exchange to go on cover.

Also, you can give your current address as your 'correspondence address' and then change it after you complete.

Contents insurance - you need to advise them the date to change the address where you want cover. This will be on the day you actually move your contents from your current place to the new one. Check you have cover for your possessions whilst in transit too.

If you don't already have contents insurance you can just set a new policy up for the new address and possibly combine it with your buildings insurance if you get a better deal that way.

The question of the property being occupied shouldn't be a problem unless you are planning a long gap between completion and actually moving in.

If you are getting a mortgage then most likely the lender will want to see a copy of your [buildings] insurance schedule before they release the money. You should provide this to your solicitor in time for completion.

Gompo

Thanks the reply, josievg. I suppose that is roughly what I assumed, I just wanted to make sure I wasnt missing anything obvious.

turtletowers

I've been told that I only need buildings insurance from when I complete, ask your solicitor to be sure.

Thanks

kingstreet

turtletowers wrote: »

I've been told that I only need buildings insurance from when I complete, ask your solicitor to be sure.

Thanks

When you exchange, you become legally obliged to purchase the property on the agreed completion date at the agreed price. If the current vendor is uninsured for some reason, you need to be sure your position is protected from the point your legal obligation starts.

MegaMiniMouse

kingstreet wrote: »

When you exchange, you become legally obliged to purchase the property on the agreed completion date at the agreed price. If the current vendor is uninsured for some reason, you need to be sure your position is protected from the point your legal obligation starts.

On the other hand, if the vendor is indeed properly insured, and you take out additional insurance, then the property is insured twice, generating a double income for the insurance industry for covering a single risk

This is just one of the reasons why it would be better to do away with the two-stage process of exchanging contracts, and then completing the purchase at a later date

MMM

kingstreet

Link to the ABI rebuild cost calculator;-

http://abi.bcis.co.uk/

MMM, that's a fair point, however I'd say better to be safe than sorry. If the vendor is insured then it would be their cover used to pay any claim.

As the period between exchange and completion is normally little more than a week or two, the potential wasted cost is small.

I'm sure one of the site's legal eagles can add more to this issue, as it's the solicitor who rings me to ask me to start buildings cover on exchange day.

MegaMiniMouse

kingstreet wrote: »

MMM, that's a fair point, however I'd say better to be safe than sorry. If the vendor is insured then it would be their cover used to pay any claim

I'm not so sure! And, in any case, if what you say is correct, then the purchaser is being seriously stitched up

I discussed this with an insurance company underwriter because the call centre person had no clue what I was talking about, and transferred my call. At first, even the underwriter seemed confused, but eventually decided that any claim would probably be shared between the two policies. He also agreed with me that the potential for fraud was enormous, in the event of both parties making simultaneous claims

MMM

kingstreet

50/50 may be correct if both parties are covered.

I think one aspect of the protection for the purchaser is more about the potential for breach of contract once exchange has taken place if you can't/won't complete...

In addition, you've exchanged on your sale and have to move out on completion day, then your purchase burns down in between times. You are going to need temporary accommodation at the very least. You can't claim on your current property insurance as there is no event on that cover.

If you didn't insure the new property, the vendor's cover won't pay for accommodation for you as you aren't the policyholder.