Listed Building Indemnity Policy

[twosmallones]

Hello,
Really hoping someone can help me with this one!
We are in the final stages of purchasing a Grade 2 listed semi-detached house, potentially exchanging next week. We got an email from our solicitor saying she is awaiting "a response from your lender that they are happy to proceed, nothwithstanding the Listed Building Indemnity Policy being offered." This has put the fear of God into me!!

We believe (but do not know for sure) that the kitchen conversion that the current owner did was not given correct planning approval and so has had to take out this insurance.
We are VERY concerned that our lender will object (at the 11th hour ) and we will be refused a mortgage. Does anyone have experience of this or advice to share?
Thank you in advance.

No advice on policies but unauthorised works it listed buildings are a criminal offence and you can be made to correct any issues. It's quite serious and I wouldn't be satisfied with just a policy- I'd be getting advice on what was undertaken, whether it would have likely been granted listed building consent and it not, how much to rectify it.

Thanks Olivia. I'm quite annoyed that our solicitor has a) only highlighted this now b) hasn't clarified any other details c) did not make us aware of it when it was discovered. I have emailed her to request what the insurance covers etc.
Thanks for taking the time to respond.

I'd be annoyed too- there can be quite strict penalties with listed buildings so I'm surprised they didn't advise you.

Hope you get a response from them soon.

Taking out indemnity insurance is commonplace - ask your solicitor how many times they have done it in the past year and I'll bet she says loads.

I don't think indemnity insurance is a good solution to lack of listed building consent especially if further works are planned. It's commonplace for lack of building regulations approval to be insured but that's a completely different situation.

If you don't plan further works, you may be okay but read the conditions on the policy very carefully before committing. Also, this is not something your solicitor should be mentioning casually - it's a fairly serious defect.

Hope you get it sorted.

I wouldn't panic about it at the moment (property solicitor and owner of a Grade II Listed house here) but you need to understand the details. Your mortgage company may object, but in my experience it's the lenders that often insist on these insurances being put in place, so I would guess it's not a deal breaker provided they are covered by the policy (chances are they will be)

The previous posters are right - unauthorised changes to a listed building without planning permission/listed building consent is an offence and even if you didn't make the alterations, you can be made to put them all back, at significant cost. Hence why the Sellers took out this insurance, because if your local planning officer objects and requires reinstatement, you should be able to claim on that policy for the cost. It's a good thing really.

Check the following with your lawyer

When was the insurance put in place and how long does it last?

Does it cover "successors in title and mortgages" ie you and your mortgage company. It should do. You need to have the benefit of it after completion.

Have their been any claims under it?

Why was it taken out in the first place?

Thank you so much for your responses, especially ChrisQuean! I shall pose those questions to her and see what the outcome is. I'm hoping our mortgage provider looks upon it favourably.

I have heard back that apparently it isn't the kitchen, it is the removal of a wall (need to confirm which!) and the erecting of an external gate.

If they have taken out a wall, check if they need or got building regs sign off. If the sellers took out a wall without LBC, then I'd want to check whether it needed building regs approval. If you're fiddling with a listed property without the correct LB consents, I'd be concerned that other corners had been cut. But the insurance policy may cover that?Check.

If it's a Grade II Listed house, I assume you got a full structural survey and that didn't highlight anything?

Word of caution on these indemnity insurance policies. Read the small print because it may not cover you if you "tip off" the local council that there's no LBC and then they enforce the reinstatement of alterations and then you try to claim for the cost.