Temporary insurance between exchange and completion

javixeneize

Hi

I have exchanged my contract now and the completion date will not happen till 20th January.

I have been told that i need a building insurance for the property for that period

Which company would you recommend for this?

Would be possible to purchase a standard building+contents insurance for the property from now on, despite i still dont own the house? Will it cover the period between exchange and completion?

Thanks

KiKi

Yes - you should have insurance from the time you exchange anyway, so you don't need temporary insurance - just buy the standard insurance you'd get for buildings and contents (assuming you need buildings insurance...leasehold flats would already have that as part of the whole insurance piece).

Personally, I get quotes on a comparison website then pick one that's at the cheaper end but has a good enough reputation to be comfortable with. I've used HSBC, the Post Office, Halifax, Santander - whichever is cheaper or offering the best deal at the time!

javixeneize

Thanks Kiki. The thing is that when getting the quote, i say that i am not living in the property yet, so i cant take the insurance. Should i say i live there already?

kingstreet

You need only buildings insurance, not contents.

Owning the property isn't relevant. Now you've exchanged contracts, on completion day you have a liability to purchase even if in the interim the property becomes a smoking heap of embers.

Why not just take out the buildings cover now and add the contents cover when you complete?

Making this purchase online may cause you issues not experienced via other methods.

agrinnall

kingstreet may well be right, it's his field after all, but you need to balance the potential extra cost of making a change to the policy to add contents cover in a month's time against paying for both buildings and contents cover from today. I did the latter when I last moved, and took out a new policy with my existing insurer to make things a bit easier (although I've since switched insurer twice to get chaper cover at renewal time).

javixeneize

Ok, so even if i am not living in the property, i can take a standard building insurance for it. It doesnt need to be a special insurance for that period, correct?

Im having a quote from Aviva at 112 pounds including contents. Sounds good, isnt it?

kingstreet

agrinnall wrote: »

kingstreet may well be right, it's his field after all, but you need to balance the potential extra cost of making a change to the policy to add contents cover in a month's time against paying for both buildings and contents cover from today. I did the latter when I last moved, and took out a new policy with my existing insurer to make things a bit easier (although I've since switched insurer twice to get chaper cover at renewal time).

Yep. True dat. I've got so used to doing cover where you can start one segment now and the other later it's difficult to tailor answers to the screen-scraper mentality of Compare the Confused and Co.

They want easy, start immediately cover and they certainly can't cope with solicitors asking for confirmation that cover meets the CML Handbook requirements.

Margot123

kingstreet wrote: »

You need only buildings insurance, not contents.

Owning the property isn't relevant. Now you've exchanged contracts, on completion day you have a liability to purchase even if in the interim the property becomes a smoking heap of embers.

Why not just take out the buildings cover now and add the contents cover when you complete?

Making this purchase online may cause you issues not experienced via other methods.

Bit off topic but also a bit on topic........I am selling and was wondering what happens if the buyer doesn't take out insurance. Should I ask for proof of the house being insured or will the solicitor insist on it? What happens if something catastrophic happens and they haven't insured it, who pays? The gap between exchange and completion is really worrying me. TIA.

javixeneize

Being spanish I am surprised I have to take insurance between exchange and completion, as the house is still owned by the seller and he lives there. He is still insuring the house for that period of time, so logic says that if something happens, it should be the seller who takes care of it... but as I said, that’s my spanish thinking. Here is totally different so looking forward to hear responses

kingstreet

javixeneize wrote: »

Being spanish I am surprised I have to take insurance between exchange and completion, as the house is still owned by the seller and he lives there. He is still insuring the house for that period of time, so logic says that if something happens, it should be the seller who takes care of it... but as I said, that’s my spanish thinking. Here is totally different so looking forward to hear responses

The latest version of the Standard Conditions Of Sale used by solicitors have the purchaser accept the risk from exchange of contracts which is when your legal obligation to purchase the property actually starts, not at legal completion.

You therefore have an insurable interest in the property from the point of exchanging contracts.

Vendor and purchaser will normally have the building insured at the same time and I'd expect the insurers to split any claim/cost between them.

Lokolo

Margot123 wrote: »

Bit off topic but also a bit on topic........I am selling and was wondering what happens if the buyer doesn't take out insurance. Should I ask for proof of the house being insured or will the solicitor insist on it? What happens if something catastrophic happens and they haven't insured it, who pays? The gap between exchange and completion is really worrying me. TIA.

It doesn't matter what happens to the house once exchanged. If it burns down, the buyer still has to purchase at the price they paid and they would have to claim on insurance for the loss.

This is why you need the insurance on exchange, as at this point you are required to complete no matter what.

The mortgage company are the ones that require a property to be insured. If you aren't purchasing with a mortgage you can still exchange and complete without the insurance. Although it would be stupid to do so.