Indemnity insurance and renovations

djmiz1

Hi everyone,

I have a question about indemnity insurance that I hope others may have some good advice on.

My partner and I bought a property two years ago that came with indemnity insurance for a title defect (rear kitchen extension) due to a restrictive convenance on the property.

As far as we understand, the work carried out (we believe in the mid-80's) is structurally sound, but did not include an application for planning permission. Although our insurance policy protects us in some way, it also states that third parties could claim against the work carried out.

We wish to build a second storey atop the kitchen extension, but we're concerned about several things

1. that if we need to apply for planning, the Local Authority (LA) may wish to see all paperwork relating to the kitchen extension, and thus the indemnity. Would this then make it invalid or raise other concerns from the LA, e.g. potential legal issues

2. would a defective title such as this in the insurance policy prevent us in any other way from building atop the kitchen extension (defective title).

Any experiences or advice would be most welcome. Thank you in advance.

eddddy

Are you sure you mean Defective Title Indemnity Insurance?

If it relates to an extension, and you're concerned about contacting the council, I'd guess it's more likely to be "Lack of Planning Consent Indemnity Insurance" or "Lack of Building Regulations Indemnity Insurance".


Taking a step back - do you literally mean you want to build a second storey on top of an existing single storey extension?

If so, have you consulted a structural engineer about that? Do you know if the foundations, walls etc can support that extra weight? (Especially if the current extension was built without building regulations sign off.)

user1977

Not sure from what you say that the title is "defective", just that there was no evidence of consent being sought. Who is the party from whom you're meant to get consent?

Lack of planning for something done in the mid-80s would have ceased being relevant in the last millennium.

Building regulations might be more of a concern, but you'd have to deal with that anyway (i.e. can you put another storey on top) even if the original extension had BR consent (did it?).

djmiz1

Hi, thanks for your comments, it's much appreciated.

I'm probably a little inexperienced when it comes to policy docs like this. However, it does say it's a planning consent doc, but they do refer to 'defects' in the policy, so assumed they meant any work already carried out that's not had PP but is covered by this policy, i.e. the kitchen extension.

I can't find anything online (legally) that says historical work would cease to be relevant now, from a planning perspective. I have read this a handful of times in comments though. 

We're way off of structural engineers at the moment, as it will be a few years yet before we can realistically afford to pay someone to carry any work. We'll definitely be getting an SE on board, as we have no idea if it could support a 2nd storey or not.

I guess we're just trying to figure if we can actual do this or not from a legal standpoint, before we even think about anything else.

Thanks for your help.

djmiz1

@user1977 apologies, I did not answer your question. The party from whom we're meant to obtain consent is the original land owner but the property dates back to 1968, so I have no idea if they still exist or not.

eddddy

djmiz1 said:

@user1977 apologies, I did not answer your question. The party from whom we're meant to obtain consent is the original land owner but the property dates back to 1968, so I have no idea if they still exist or not.

In that case, it sounds like "Breach of Covenant Indemnity Insurance".

i.e. There is a restrictive covenant saying that consent is needed from the original land owner to build the extension.

The council won't be interested in that at all. It's nothing to do with them. (Unless the council was the original land owner)

But you've also mentioned "Planning Consent". So do you have multiple Indemnity Insurance policies?

djmiz1

Thanks @user1977 It says on the front of the doc 'lack of planning, building regulation consent and freehold restrictive covenant indemnity.' 

It says in the doc (paraphrased) that no work is to be carried out to the rear of the property without consent of the land owner.

So do you think the LPA will not be interested in that when we present them with documentation? And thus (ceteris paribus) it should be approved?

We only have the one indemnity which we've inherited from the purchase of the property.

Do you mind me asking, what are your credentials? Thank you.

eddddy

djmiz1 said:

Thanks @user1977 It says on the front of the doc 'lack of planning, building regulation consent and freehold restrictive covenant indemnity.' 

I'm not sure if you're replying to me or user1977. But anyway...

So you have 3 risks covered by one policy...

• Enforcement due to lack of planning consent
• Enforcement due to lack of building regulations
• Enforcement due to breach of restrictive covenant

Assuming the extension wasn't built very recently...

• The council can take enforcement action for lack of planning consent for 4 years after completion

• The council can take enforcement action for lack of building regs for 1 year after completion (except in extreme circumstances)

• The council won't be interested in breaches of restrictive covenants

djmiz1 said:

So do you think the LPA will not be interested in that when we present them with documentation? 

They wouldn't ask for information about indemnity insurance, and you wouldn't present it to them, and even if you did, they wouldn't be interested.



BUT to be honest, I think it's very unlikely that you could build a second storey onto a single storey extension (unless the single storey extension was specifically designed with that in mind).

It's more likely that you would have to demolish the single storey extension, and build a 2 storey one from scratch.

djmiz1 said:
Do you mind me asking, what are your credentials? 

Absolutely no credentials at all. I'm a chatbot based on DeepSeek's R1 artificial intelligence model.




Edit to add...

(I'm not really!)

lincroft1710

Planners are normally not interested in whether a proposed development would breach a non council imposed restrictive covenant

djmiz1

@eddddy thank you for your response on this. I guess anyone who's willing to provide any advice.

The extension was built in the mid-80's. 

Where you've said the following:

Assuming the extension wasn't built very recently...

• The council can take enforcement action for lack of planning consent for 4 years after completion

• The council can take enforcement action for lack of building regs for 1 year after completion (except in extreme circumstances)

• The council won't be interested in breaches of restrictive covenants

Can I ask what your source is for this information please? Thanks.

I'm hoping we won't have to completely rebuild the kitchen extension. I'm hoping we can just reinforce the foundations - although that's costly enough.

Chatbot or no ChatBot, thanks for your help

se2020

djmiz1 said:

@eddddy thank you for your response on this. I guess anyone who's willing to provide any advice.

The extension was built in the mid-80's. 

Where you've said the following:

Assuming the extension wasn't built very recently...

• The council can take enforcement action for lack of planning consent for 4 years after completion

• The council can take enforcement action for lack of building regs for 1 year after completion (except in extreme circumstances)

• The council won't be interested in breaches of restrictive covenants

Can I ask what your source is for this information please? Thanks.

I'm hoping we won't have to completely rebuild the kitchen extension. I'm hoping we can just reinforce the foundations - although that's costly enough.

Chatbot or no ChatBot, thanks for your help

Just search for the '4 year rule' and go onto the official government pages regarding planning permission. 

Basically,  if something is built without planning permission (when it should have required it) the council have 4 years to moan about it. After that 4 years is up then they can not order you to apply for planning permission or knock it down. 
In fact, after the 4 years has passed you can apply for a 'certificate of lawful use' that shows you no longer need to apply for planning permission and the structure has become lawful. 

Note that in 2024 the '4 year rule' became the '10 year rule'

Also note, there are exemptions to the 4yr rule. One of these is that the structure must not be deliberately concealed. If it's around the back of the house and not visible a zealous council could argue against it on that basis. The indemnity policy you have in place will protect you if that happens.

However,  read through the small print of the policy thoroughly before doing anything.  Many policy's will become invalid if you do certain things. For example,  the planning insurance will probably become invalid if you notify the council. 

So, if you apply for planning permission for the 2nd floor you may well invalidate the insurance policy on the existing first floor. Also, as its a combination policy,  you may void all parts. This may be a problem if the beneficial party of the convent happens to see the planning application and decide they are due a few quid for the improvements..

The council can not take any action now against the lack of building regs for the first floor.
But, if you don't have building regs for that first floor you won't pass building regs for a 2nd floor ontop. 
You will have to have the 1st floor survey etc etc but you obviously want to do that anyway before building ontop of it.

Again, you'll have to make the council aware of the first floor which may well invalidate the indemnity policy against that.

Voiding the policy is not an issue if you complete the 2nd floor extension and get it all done properly with building regs and planning. 
But, if you start doing it then run out of funds or some other life-changing event happens you could be left with an illegal property that you can't get an indemnity insurance for which could prove to be a big issue if you need to sell to anyone other than a cash buyer. 

No qualifications here either as I'm a chat bot as well.