Indemnity insurance - do I need it?

[RichGo]

I have lived at my current property for 21 years. Long before we moved in the kitchen was extended and two chimney breasts were removed.

We are trying to sell the property and the buyer's solicitor's have written saying that as we couldn't supply planning permission or building regs certificates for these works done, they require us to fund an indemnity insurance policy for the purchasers (£188.00).

This seems rather odd, as if there was any problem I would have thought they would have come to light before now...

It also seems rather unreasonable as we were not involved in the extension work or removal of the chimneys - all way before our time.

Can anyone advise me as to whether such a request is reasonable (clearly it doesn't seem reasonable to me!) and whether I have an obligation to pay such insurance.

First posting - so thanks to anyone who replies.

[Kaz]

Hi

I'm not a solicitor but I think these indemnity insurance policies are pretty much standard these days if PP/BR are not available.

I've got a feeling that it's the lesser of two evils - i.e. getting retrospective PP/BR.

I'm sure someone more qualified to answer will be along but hope this helps in the meantime

[New Homes Expert]

Pay the insurance premium and move on.
You should have got Planning and Building regs approval when you bought it and you are lucky that the buyer still wants to continue. I wouldnt!

[RichGo]

Thanks Kaz for the advice.

New Homes Expert "You should have got Planning and Building regs approval when you bought it and you are lucky that the buyer still wants to continue. I wouldnt!"

I'm surprised by this comment - we bought the house over 20 years ago. In those days none of this was ever mentioned - I still have all the documentation to do with the house purchase from 1990 and in those days questions on extensions already in existance were not included on any of the solicitor's questions, enquiries and so on. I have the survey from buying the property too - and no mention is made there as to the extension or chimney breasts... so I'm really surprised that someone thinks I "should have got Planning and Building regs approval when I bought it"!

[Richard Webster]

First separate Planning & Buildign Regulations. They are different.

After 21 yaers there is no possibility at all that any enforcement action could be taken under Planning so an indemnity policy for that is unnecessary.

On Building Regulations there two issues for the buyers:

a) Will the Council do anything after 21 years - very very unlikely indeed but unlike Planning, still theoretically possible. Policy protects against this tiny risk.

b) Will there be some damage cause through structural failure etc which can be traced back to a failure to comply with the regulations. Possible, but again most people would say this was pretty unlikely after 21 years. Some buyers don't understand the distinction and although their solicitors should point out what an indemnity policy does and doesn't protect against, buyers often don't understand and offering them a policy is comforting for them and can avoid them getting worried about it.

Also, regrettably, mortgage lenders tend to want their backs covered completely and so even if the buyers are not bothered at all if there is a lender involved it is often the case that indemnity policies are needed. Some lenders require that Building Regulation issues are checked back almost forever!