Do we need Indemnity Insurance?

SamKumra_2

Hi to all you knowledgable folk!

Have read a few posts, new and old, on indemnity insurance although they don't quite cover our situation...

We are buyers, due to exchange/complete in 10 days! The house we are buying was marketed as a 4 bed and the price we've agreed on is based on local 4 bed house prices. The survey came back saying the loft conversion was not habitable as doesn't comply to todays building regs and is therefore a 3 bed. We obviously don't want to pay the money for a 4 bed if it techincally is a 3 bed.

The current sellers bought the property in 2007, at the same time the building regs changed and they didn't have any problems so can't understand what all the fuss is about and have said they are not willing to get the required changes to the loft made to bring it up to new regs in time for completion. I think it just needs a fire door, although this has not been confirmed by surveyor as she has picked the last 2 weeks to be on holiday! No building regulation docs are available probably because the conversion was done in the early 70's.

Solicitor has mentioned indemnity insurance although I am unclear as to exactly what this would insure us for?

We have 2 worries....
1) If we were to sell the house on would the indemnity insurance cover us against the drop in value of the house from 4 bed to 3 bed?

2) As the surveyor has said it is currently a 3 bed do we insure the property as a 3 bed or 4 bed? If we were to use the loft as a bedroom would our insurance cover us?


Do we need this indemnity insurnace? If we get the fire door installed could the council come out and give us some sort of certificate to say it has passed current building regs? How much does that cost?


Thanks

G_M

The indemnity policy will cover you if the council decide at any time to enforce the planning/building Regs process.

Unless the council have been alerted ie if you've been to them and said "this house has a converted attic, is it legal?"

However the indemnity policy will NOT cover you if the conversion was badly done. ie if the attic floor which was not originally designed for furniture/people, was not strengthened, and gives way. You fall through and injured? killed? No insurance.

If the roof joists were removed to make headroom and the roof collapses? Tough. Indemnity insurance is ONLY insurnace against enforcement.

Oh, and your normal household insurance? Also won't cover any accident /incident in the attic as the attic is unregulated......

So
1) If we were to sell the house on would the indemnity insurance cover us against the drop in value of the house from 4 bed to 3 bed?No

2) As the surveyor has said it is currently a 3 bed do we insure the property as a 3 bed or 4 bed?See my point about house insurance above If we were to use the loft as a bedroom would our insurance cover us?No

sonastin

When you finally get hold of the surveyor, find out if the loft conversion is structurally sound. "Not in line with current building regs" does not necessarily mean "not habitable" - all those lovely old victorian and edwardian properties where the maid used to be stashed in the attic wouldn't comply with current building regs and the council aren't about to go taking enforcement action against owners of those houses are they?

If it was converted before building regs were in force, there won't be a paper trail to show that it was done in line with building regs (of any era). Doesn't mean that it isn't safe, but equally doesn't mean that it is. There is nothing for the council to enforce so nothing to get indemnity insurance against but you should check that the floor joists and roof rafters have been sized to take the weight of a habitable room.

One thing you might want to check is the insulation up there. It almost certainly won't comply with current regs up there but if there is no real insulation, it will be a sauna in summer and an ice box in winter.