Chancel repair liability

Scotbot

Apparently the property I am buying is liable for chancel repair. There is an indemnity insurance in place. My concern is what if I  am issued with a repair notice and the insurer refuses the claim or worse still no longer exist? It is not everyday insurance I am thinking long term here I could be in the property in 20 years time.

Would you be concerned or am I overthinking this?

DullGreyGuy

Scotbot said:

Apparently the property I am buying is liable for chancel repair. There is an indemnity insurance in place. My concern is what if I  am issued with a repair notice and the insurer refuses the claim or worse still no longer exist? It is not everyday insurance I am thinking long term here I could be in the property in 20 years time.

Would you be concerned or am I overthinking this?

Given the potential cost of repairing a church -v- causing major injuries to multiple people in a car crash if you're going to worry about insurers not paying out or going insolvent surely you car insurance is a much bigger worry than your chancery repair indemnity?

In principle its a risk but ceasing to exist then gets you into FSCS cover 

Bookworm105

I understand your concern as it w(c)ould be an expensive repair, but at what point does reality kick in?
Take out an insurance policy against an insurer going bust?
Insure against the insurance above failing as well as the ultimate insurer going bust?
Rely on FSCS cover?

i think you are overthinking. Yes you need chancel repair insurance, get it and relax 

Scotbot

The house already has insurance so the alternative would be to pull out of the sale. I have never heard about chancel repair before and have no idea how common an occurrence it is.

Skiddaw1

It's fairly common. If it is any help to you, OP, all the houses in our small estate (and, indeed, a fair proportion of other houses in our village) are liable for chancel repair (village church). We all have indemnity insurance and our conveyancing solicitor wasn't concerned about it.

DullGreyGuy

Scotbot said:

The house already has insurance so the alternative would be to pull out of the sale. I have never heard about chancel repair before and have no idea how common an occurrence it is.

12,000 homes were registered after the law changes in 2013 however its only really triggered at the next sale so there will be plenty more homes which are liable despite not being registered as they've not been sold since (gifted/inherited property doesn't trigger the new law). 

The average premium for indemnity insurance is around £50 and most are under £100 which shows the level of risk being run. That said costs can be fairly high, one of the most famous cases was https://en.wikipedia.org/wiki/Aston_Cantlow_Parochial_Church_Council_v_Wallbank where they were required to pay £100k but fought it extensively and ultimately lost and so became liable for the legal costs that more than doubled the monies due. 

NameUnavailable

God moves in mysterious ways!

Yorkie1

Has your solicior confirmed that the existing chancel liability insurance will be transferred to you on the sale?

amandaleeds

Yorkie1 said:

Has your solicior confirmed that the existing chancel liability insurance will be transferred to you on the sale?

Can this be done? I'm in the same boat, but not yet sure if the sellers have chancel repair insurance 

user1977

amandaleeds said:

Yorkie1 said:

Has your solicior confirmed that the existing chancel liability insurance will be transferred to you on the sale?

Can this be done? I'm in the same boat, but not yet sure if the sellers have chancel repair insurance 

Pretty standard that this sort of indemnity insurance can be transferred (with no formalities required) to subsequent buyers/lenders.

doodling

Hi,

The OP.needs to talk to their conveyancer to understand the precise position.

In particular the following questions might be relevant:
1. Is it guaranteed that the insurance will be transferred and remain in force?
2. Has the church registered the liability at the land registry?
3. What happens if the sale takes place without an application to register the liability at the land registry being made b vthe church?

My understanding is that, following the change of law in 2013, unless the liability is registered at the land registry then the sale of the property extinguishes the liability so the insurance may only end up being needed to cover the period until the sale is complete and it is then superfluous.

Of course, if the liability is already registered at the land registry then the existing insurance is absolitley critical - you would probably not be able to obtain such insurance on the property now so you need to be absolutely certain that the existing insurance will be transferred.

I am not a lawyer, hence you need to get clear answers from whoever is handling your purchase.