indemnity insurance - why should we (buyer) pay half? help

Woby_Tide

that's all an assumption though, the OP makes no reference to their being issues with planning permissions or insurance, just that a solicitor has suddenly decided they need one (when a previous solicitor didn't). Who is right?

silvercar

Woby_Tide wrote:

that's all an assumption though, the OP makes no reference to their being issues with planning permissions or insurance, just that a solicitor has suddenly decided they need one (when a previous solicitor didn't). Who is right?

The previous solicitor would have been acting in the interests of the now seller. If it is this seller who has done work that hasn't got necessary permissions then there will not be a previous solicitor who has said an indemnity is not required as the situation has not arisen before.

I agree that until we know what the indemnity is meant to be protecting the buyer from we can only spectulate.

mrsc_4

Our vendor didn't have indemnity insurance when she brought the house 9 years ago but our solicitor has insisted on it this time round.

Woby_Tide

silvercar wrote:

The previous solicitor would have been acting in the interests of the now seller. If it is this seller who has done work that hasn't got necessary permissions then there will not be a previous solicitor who has said an indemnity is not required as the situation has not arisen before.

Unless the OP's terminology of 'moving in' means that the current vendor only moved in after having the kitchen built themselves then fair enough. I took it to imply that the kitchen was already built prior to the previous purchase of the property.

I think indemnities look more and more of a con. As you say, most people can't actually see what is and isn't being 'protected' (the fact they are so 'cheap' per year also makes it look the insurers rarely have to pay out at all)


Edit: that said should any of my advice be incorrect I can offer an indemnity that should you have acted on my advice and it is subsequently wrong you will be fully covered (Disclaimer: one claim only policy, max payout £15, compulsory excess £10)

Anyway the policy is yours for a one day only bargaiin price of £25, cheques payable to "Tides - The insurer who's on your side"

Loafer316

Are you taking out a mortgage to buy the house??

The reason i ask is that the majority of the time the solicitor will also be acting on behalf of your lender. If your lender has outlined the kitchen extension in their valuation report or in the mortgage conditions then your solicitor will also be under an obligation to protect the lender (as they have lent the buyer the money) and you from any future action from the local authority. The majority of lender are happy as long as there is an indemnit policy in place.

Again this is quite subjective, but the solicitor may be acting in your best interest because you, as well as him/her want the exchange to go smoothly. Again as others have said the seller is under no obligation to pay for indemnity policy but it depends on how desperate he is to sell it. Paying half each is quite common and an amicable solution.

However, as a side note if after the purchase you decide to contact the council and resolve the issue about the extension then your indemnity policy will become void as you would have put the council on notice of the extension.

silvercar

mrsc wrote:

Our vendor didn't have indemnity insurance when she brought the house 9 years ago but our solicitor has insisted on it this time round.

9 years ago!

4 years is the limit for taking action for lack of consents! I would ask your solicitor what you are insuring against. If he says the council demanding you remove the extension ask him about the 4 year rule!

mrsc_4

The work on the property was actually done 27 years ago (its older than me I'm only 26 LOL) but without planning permission and building regs.

Our Lender has insisited on the insurance we were happy to proceed without it but at least for a couple of hundred quid everyone is happy and our Vendor was happy to pay for it, lower the cost = lower the risk

silvercar

I wonder if the extension was within permitted development at that time? In which case PP wouldn't have been needed.

27 years is a joke! money for nothing for the insurers.

BobProperty

Woby_Tide wrote:

.....Edit: that said should any of my advice be incorrect I can offer an indemnity that should you have acted on my advice and it is subsequently wrong you will be fully covered (Disclaimer: one claim only policy, max payout £15, compulsory excess £10)

Anyway the policy is yours for a one day only bargaiin price of £25, cheques payable to "Tides - The insurer who's on your side"

Is that with the "King Canute Indemnity and Tiger Charm Company"?

mrsc_4

silvercar wrote:

I wonder if the extension was within permitted development at that time? In which case PP wouldn't have been needed.

27 years is a joke! money for nothing for the insurers.

I don't know to be honest there is an awful lot of work done, a sinle storey rear extension, a loft conversation (into 2 nedrooms) and the removal of an internal load baring wall!!!!!!!!!!!!!!!!!!!!