house insurance before exchange/completion?

cleofish

Hi, wondering if anyone can help.

We are in the middle of buying a property and we have had the mortgage offer through and now our solicitor has asked for house insurance details.

I understand as a condition of the mortgage we need building insurance, but when would this start from and how would we begin in searching and comparing prices when we technically dont own the property yet?

Things are coming back and for from the solictors paperwork etc and the last things we sent off were the signed mortgage contract but we haven't yet agreed on an offical exchange or completion date.

We were going to wait to hear back from the contracts and ask for completion the end of august if possible. However we have heard back today that the sellers will be going on holiday mid august and have written to our solicitor to ask for a draft transfer and engrossment form to be sent so they can get it signed, is this the start of the exchange?

Bit off topic there, but in terms of getting house insurance when would we date it from? As we have no exchange or completion date. and is there anything special we need to fill in/tick when comparing insurances or does it need to be through particular agencies as we dont yet own the house?

Thanks in advance.

G_M

When? It depends

a) what your mortgage lender demands as a condition of the mortgage and
b) whether you (or your solicitor if you have one) are using the Standard Conditions of Sale 4th or 5th Edition.

kingstreet

Broker insurers are happy to receive an application which is held until an "on risk" date is provided and that can be the exchange date for the buildings cover and completion date for the contents bit. They even fax details of the cover to the solicitor in advance of exchange, so the solicitor can confirm to the lender that it satisfies the usual CML requirements;-

- index linked
- no more than £1,000 excess for subsidence heave and landslip
- usual risks are covered

etc.

It's only those who use comparison sites that appear to have a problem with the system of house purchase. The rest of us have been doing it like this for donkeys years.

cleofish

Thanks for your reply,

What are brokers insurers are they similar for brokers for mortgages as in they search for the best 'fit' for our situation?

Where would I go about finding a reliable one?

kingstreet

The insurers brokers use pay them a commission for doing so. You tend to get better quality cover, such as trace & access and there may be no charge for monthly premiums, with cancellation at a month's notice without ridiculous fees. You are unlikely to get the cheapest, stripped-out cover from a broker.

Brokers have internal comparison sites which compare premiums and quality of cover and many use the defaqto star ratings to compare the quality of the cover, in addition to the price.

https://www.defaqto.com/star-ratings/home-insurance

I tend to use only three and four star products, as these tend to cover more issues, such as the trace and access I mentioned.

You can normally work from either the rebuild cost provided by the surveyor when the mortgage report and valuation or survey were done, or use "blanket" cover where the premium is based on the number of bedrooms and the postcode, not the sum insured.

You can google "insurance broker" and see who operates in your area, or ask friends and relatives for a recommendation. Try to avoid Swinton, as they don't have the best reputation.