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Building insurance on ew property

(10 Posts)
Pud2 Tue 12-Jun-18 20:06:04

I’m in the process of buying a new house. My solicitor has said that I must arrange insurance and need to ‘make arrangements with your insurance provider that you can put the policy on risk as the result of a telephone call that you will make on the day of exchange of the contract’.

I’m not entirely sure what this means??! Any help appreciated.

Pud2 Tue 12-Jun-18 20:21:47

*new not ew!

bilbodog Tue 12-Jun-18 20:59:37

When you exchange contracts you become liable for the structure of the building so need buildings insurance from the date of exchange. You dont need contents insurance because you are not living there yet but need contents insurance on completion date. Just speak to an insurance company who can quote which will be based on the price and location of the property you are buying.

Caroian Tue 12-Jun-18 21:02:59

Don't worry - it's largely legalese! In the sentence you have typed you can substitute "put the policy on risk" with the words "activate the policy" if that helps.

Basically you must have insurance in place from the day of exchange (because you must then buy the house, eve if it burns to the ground). What they are saying is that you need to arrange the cover and then call the policy provider once exchange happens to activate it. The idea behind arranging then formally activating cover is that if exchange fails to happen, you don't get stung for cancellation fees.

In practice you can, these days, often arrange cover in between the time that your solicitor calls for authority to exchange and them calling you back to say it has happened. You can also arrange cover online a few days before anticipated exchange and specify an activation date, but then take advantage of the "cooling off period" to cancel should things go pear shaped.

Dadsussex Tue 12-Jun-18 22:29:37

When you exchange you contract to buy the property and the seller contracts to sell, basically only someone with insurable interest can make a claim and hence therefore the buyer needs to insure

Check your policy as most buildings insurance policies do not cover carpets - instead these are covered under a contents policy so actually if the property has carpets or non glued down vinyl flooring then adding contents insurance from the date of exchange is actually advisable

specialsubject Wed 13-Jun-18 09:27:29

and next time you dont understand the solictor, ask for clarification. you are paying this tin god.

Pud2 Wed 13-Jun-18 20:57:20

Thanks everyone. Got a call from the agent today and it looks like I’m going to be gazumped. Soooo annoying. Can’t believe it’s still allowed to happen!

MummyM33 Wed 13-Jun-18 21:53:49

@Pud2 hats awful. I'm in the process of buying a house and this is my big fear! Disgusting that it's still allowed to happen sad van I ask how far you are into the process, how long since your offer?

MummyM33 Wed 13-Jun-18 21:54:06


Pud2 Thu 14-Jun-18 20:13:49

It’s just so annoying and it should not be allowed. I had the offer accepted about two months ago and the house was off the market. They’ve accepted an offer from their neighbour for a private sale. Luckily I haven’t had the survey or searches done yet so it will just be solicitor fees. Good luck with your purchase. Hopefully it will all go through.

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