HELP - Building Insurance [ongoing settlement] - nearing exchange

harrieteve

Hi everyone, 

[Summary: settlement vs subsidence, specialist insurers, should we pull out, how should we disclose / phrase to prospective insurers] 

Would really appreciate some advice. We're FTB nearing exchange on a 1900 period house in SW London (clay foundations). We've been back and forth on a full homebuyers survey, an independent damp survey and are now potentially falling at the hurdle of house insurance. 

The surveyor has noted historic and ongoing settlement in the following ways on the report: 

"From my observations there are signs of movement within the external walls which has resulted in damage /cracking in the render. The movement will require monitoring in the future and will require the any future cracks being cut out to receive steel reinforcing bars inserted into the brick joints. The bars require bedding in epoxy resin and the cracks made good and decorated. You must be aware that due to the nature of the soil conditions, the foundations will be subjected to movement which will result in hairline cracking and movement in the main structure. From experience buildings of this age and location are only treated with rendering to hide old cracks in the original fabric. Historical settlement beneath the foundations is visible as the suspended timber floor joists have settled in the majority of the habitable rooms and entrance hallway."

"Historical and ongoing movement in the load bearing walls is still ongoing and will require repairing and decorating on a regular basis."

General conclusions "At the time of my survey, I found signs of historical minor and current structural movement and settlement beneath the foundations within the property. This has resulted in the floors to slope and areas of defective wall plaster. These are not serious but ongoing. This will result in future cracks appearing in the internal plaster ceiling and wall areas. The cracks can easily be cut out, filled and decorated. Unfortunately this will be necessary on a regular basis." 

We followed up for more clarification over email, asking whether this could cause subsidence or need underpinning and we got the following: "I have inspected numerous properties similar to yours. The main problems found are 1. Shallow foundations 2. Clay subsoils 3. built on made up ground -ie fill. Properties will experience localised movement resulting in on going cracking especially in dry or very wet seasonal weather. It is unlikely that your property will require underpinning but will suffer from ongoing minor cracking in the fabric."

We spoke to a couple of structural engineers who said they wouldn't be able to tell us much more in a visit due to the property being recently rendered. We decided to push on with this risk understanding that it's minor but have so far struggled to get insurance. 

Home Protect reviewed our survey and said it was outside their appetite for risk. When we go through generic quotes online they often seem to ask about 'heave, subsidence and landslip' which we think the answer is "no". On this basis we could potentially get insurance but could this be void in the future? Are there some insurers who have a better understanding about settlement vs subsidence. We understand many don't cover settlement which is fine but would want subsidence cover. 

Finally, is this usual insurance companies being overcautious or is this a sign that the issues with this house are bigger than we think and we should just walk away regardless of whether we can find someone who will insure. 

PS we asked who the previous insurers were and they were landlord insurance (it was rented) so don't know if we'll be able to go with them but we can try. 

Thanks so much in advance, 
Harriet

canaldumidi

You have two issues:

1) the property has ongoing movement requiring ongoing maintenance. This is a risk. It might get worse, but from what the surveyor says (and he seems knowledgeable and aware of the local issues) probably not. Do you want the house enough to take on that risk? From what you say, the answer is yes.

Oh: my house is 150 years old, shallow foundations. There's a stone porch and every year it moves as the ground dries out in summer. A gap opens up betwen porch and house. In winter, it closes again!

2) insurance.

ask about 'heave, subsidence and landslip' which we think the answer is "no". On this basis we could potentially get insurance but could this be void in the future? 

Yes- it could be void, but if you answer "no" you won' find out till you claim. Definitions of "heave, subsidence and landslip" are ambiguous, overlap, and can include/exclude "movement". I would look for a specialist broker or insurer who coers subsidence. Use duckduckgo (or goggle if you must!). 'subsidence insurance broker'. Or

https://www.biba.org.uk/insurance-guides/home-insurance-guides/subsidence/

harrieteve

Thanks so much - very helpful advice. You’re right it’s definitely both of those counts causing issues and there are other unknowns with the house too - damp etc so overall it feels a bit too much. 

However we know old houses all have problems so just want to make sure we’ve explored all the options.