Indemnity insurance prospective buyer

KatieXZoe

fackers_2 said:

I hate these policies, starting to feel like a bit of a scam... Sold incase of a mouse farting... Seems it's now a compulsory add on (with interest) by Solicitors.

Yes this is pretty much the way I'm seeing it too. Thankfully we are not paying for it. The buyers solicitor was paying (they are buying a new build so development paying) it was originally £50. Vendors categorically said they are not paying (seems silly right?) But gets worse, vendors solicitor takes it upon themselves to confirm that what my search results have said about the road adoption is actually true, and contact the council directly to ask. Council confirmed what we already knew but now said solicitor has completely shot themselves in foot as this in itself has made the initial indemnity invalid as council now aware of policy against them and insurance co don't like it. So, have had to create a new policy acknowledging this and this has now shot up to £450...

Section62

KatieXZoe said:

fackers_2 said:

I hate these policies, starting to feel like a bit of a scam... Sold incase of a mouse farting... Seems it's now a compulsory add on (with interest) by Solicitors.

Yes this is pretty much the way I'm seeing it too. Thankfully we are not paying for it. The buyers solicitor was paying (they are buying a new build so development paying) it was originally £50. Vendors categorically said they are not paying (seems silly right?) But gets worse, vendors solicitor takes it upon themselves to confirm that what my search results have said about the road adoption is actually true, and contact the council directly to ask. Council confirmed what we already knew but now said solicitor has completely shot themselves in foot as this in itself has made the initial indemnity invalid as council now aware of policy against them and insurance co don't like it. So, have had to create a new policy acknowledging this and this has now shot up to £450...

It sounds like the solicitor(s) are getting themselves tied up in knots.

As I suggested earlier in the thread, it was almost certain the council were aware that the road wasn't adopted, one of their jobs is to keep the official record of which highways are maintainable at public expense (e.g. adopted) and which aren't.

The indemnity policy wouldn't be "against" the council as such.  The council normally would simply have no interest in the road unless, for example, there was a planning condition requiring the road to be constructed to adoptable standards and offered up for adoption.  In which case that would be a planning matter rather than highways.

With unadopted roads the type of risks an indemnity policy might cover could include a lack of right to use the road or a situation with unknown ownership. But in these situations if the council acts it would normally be in support of the residents - e.g. if they cannot provide a refuse collection service because of the state the road is in.

So what specific risk(s) is the solicitor saying the original policy covered which required its existence to be kept secret from the council?

user1977

It's nonsense to suggest the indemmity policy means you're not allowed to contact any department of the council about anything to do with the property. Yes, if the policy covers a lack of building regulations, the insurers won't want you to tip off building control, but the roads department don't know and don't care about conservatories.

I've had this sort of discussion with insurers where their wording has been vague (e.g. where the policy was about lack of title to land potentially owned by the council, but the buyer was making planning applications) and they have managed to clarify that dealing with a different council function is not a problem.