Home insurance for a new build at exchange

Tom161992

Hi All,

We are in the process of buying a house and are due to exchange very soon. The house is a new build and is part way through the construction process.

We understand that we need home insurance at the point of exchange. We did the usual search on various comparison sites, before calling admiral to discuss multi policy discounts. When we contacted admiral, they advised that they couldn't provide the policy they had quoted for (building and contents), as the property is mid construction and we aren't living there yet.

How can we get home insurance for our home during construction? Has anyone had this issue before?

Thanks

user1977

Tom161992 said:

We understand that we need home insurance at the point of exchange. 

Your understanding is wrong. The builders insure until completion.

Tom161992

user1977 said:

Tom161992 said:

We understand that we need home insurance at the point of exchange. 

Your understanding is wrong. The builders insure until completion.

Thanks, however our mortgage provider insists we insure from exchange. 

Does that change it at all?

At the point of exchange we are legally required to buy the property. Therefore insurance from the builders side isn't going to help that, if something goes wrong. 

user1977

Tom161992 said:

user1977 said:

Tom161992 said:

We understand that we need home insurance at the point of exchange. 

Your understanding is wrong. The builders insure until completion.

Thanks, however our mortgage provider insists we insure from exchange. 

Where have you got this from? Your mortgage lender has no interest in the property until completion. What happens between exchange and completion isn't their problem (because they're not going to hand over their mortgage funds in return for a smouldering ruin).

At the point of exchange we are legally required to buy the property. Therefore insurance from the builders side isn't going to help that, if something goes wrong. 

You're legally required to buy the property after it's been built. The builders' insurance covers it until completion. It's an exception from the "normal" rule about insuring from exchange.

Irishpearce26

Tom161992 said:

user1977 said:

Tom161992 said:

We understand that we need home insurance at the point of exchange. 

Your understanding is wrong. The builders insure until completion.

Thanks, however our mortgage provider insists we insure from exchange. 

Does that change it at all?

At the point of exchange we are legally required to buy the property. Therefore insurance from the builders side isn't going to help that, if something goes wrong. 

If it wasn't a new build then yes you would insure at exchange but as your house isn't built yet then the builders insurance covers it until they complete. Just make sure your lender is aware of that. However I have never had to provide evidence that I have insured the house both times I have exchanged or completed.

BigD74

Sounds like your mortgage provider may not be aware that it’s a new build? Having recently been through the process myself, I can confirm that as a buyer you can’t insure a property that isn’t built yet. This is covered by the builder’s insurance. 

kingstreet

What does your conveyancer say? As they are representing both you and your mortgage lender they will ultimately know if this requirement is true. Which IMHO it isn't, newbuild mortgage specialist.

pinkteapot

Agree with the others - we've been asked for buildings insurance cert on exchange when buying second-hand houses, but not when buying new build. Get your solicitor to check. 

Tom161992

Thanks all, good to hear the experiences. The lender knows it's a new build, so clearly just some crossed wires! I'll get in touch with the solicitor! Cheers. 

bramptonbrew

Just wanted to add my experience - we got life insurance at exchange but home/buildings insurance will only kick in at completion.