Re: Insuring an Underpinned House

[Owain]

"Paul White" wrote | Our lenders (the Nationwide) are being very difficuly with the mortgage | application. They are refusing to provide their own insurance (fair enough) | but are insisting that any buildings policy we take out has "normal | premiums" and a subsidence excess of no more than £1000. | What I don't understand is, what difference does it make to the lender ? So | long as we have sufficient buildings insurance surely the premiums and | excess are irrelevant ?

They specify the subsidence excess as something you are likely to be able to afford, ie to make sure the house is effectively insured. Otherwise there would be nothing to stop you taking out insurance which had a subsidence excess of £100,000 - that would be very cheap for you in premium but would leave the house in effect uninsured against subsidence.

Dunno about the rest though.

Owain

[John Stumbles]

I know it's not what you're asking but when we bought our house, which had been underpinned, we made a point of insuring with the previous owner's insurers; reckoning that (a) if they'd paid for the work to be done they'd satisfied themselves that it had been done correctly and should have no problems with reinsuring it (b) if there were a subsequent problem it would reduce their latitude for argument about which insurer was liable.

(* I know neither of these is necessarily true on the planet Insurance Companies live on)

-- John Stumbles

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-+ Which Tyler: leader of the pedants' revolt.

[L Reid]

Remember that when you come to sell the house that your buyers will face the same problems as you currently are. Maybe not a problem if the market's up, but if it's depressed...

[N. Thornton]

Hi Paul.

Subsidence is a funny subject - well its not, but insurers and mortgage cos get very funny about it. As long as you have official paperwork that states all is fixed there shouldnt be a problem - but there always is.

There are many cos who will insure your situation and worse ones, just talk to the high street brokers who will be able to steer you to the ones that do this. Mostly its smaller companies.

Really this whole area has turned into a right game nowadays. The stories about mortgage requirements are sometimes farcical, and really demonstrate that a lot of companies simply dont have the technical expertise to make reasonable decisions.

Its a game of pass the buck, who cares what it costs the buyer, and how can we wriggle out of our responsibilities.

But you shouldnt have any prob gettnig insurance, even if many companies wont touch, it some will. Try Royal + Sun Alliance for example, I know of them knowingly insuring properties with bigger issues than yours.

Regards, NT

[John Jardine]

Nationwide are being naturally cagey 'cos of the potential money recovery problems involved in any further structural work being needed. Yes, all the paperwork ect is in order, yes, there will be a defined liability route if problems occur. But ... say they lend all their money to you and the house falls down. The line of financial liability or blame, via the insurance coverers, could eventually lead to the lone individual who had the original work done. This is bad news from a morgage lender or insurers point of view as for various reasons it may be impossible to recover costs from this individual or the structural people he employed if he/they are at fault. Nationwide have then lost all the money they lent you. Dealing on a claim with an insurance company doesn't carry this risk as the money will *always* be available after liabilities have been argued over.

Unsatisfactory underpinning work does get done as I found out myself. My original underpinning work had been done under the insurance, signed off by the structural surveyors and the local council standards people, 30 year guarantees placed with the deeds. 3 years later I got that sinking feeling again but it was again handled seamlessly by the insurance companies with absolutely no problems as they had traceable liabilities to other insurance companies. They've now shelled out £25k on my house and I'm pleased to be still living here. The story could have been a lot different if the insurers were still chasing the original builder or surveyors. regards john

[Al Reynolds]

I had some friends who had exactly the same problem with the Nationwide. They decided to walk away in the end on the premise that they would have the same hassles when they decided to sell. If you really want the house, then I would switch lender to one which takes a more personal/reasonable approach.

Al

[Hugo Nebula]

From the chaotic regions of the Cryptosphere, parish wrote on Tue, 05 Aug 2003 01:06:04 +0000:

If we're talking about Building Control, then they only inspect to ensure that the work complies with the requirements for health, safety and welfare, not for financial losses. I pay my Council Tax. I don't want those taxes to pay for failures in work which was not underwritten by an insurance company or a structural engineer's liability insurance.

[jerrybuilt]

Damned pen-pushing jumped-up pontifical clerks.

Sloppy bunch of herberts with cushy jobs.

If the laughable "BCO" is going to pass something, he should be personally liable. That'd sort 'em out. Good riddance.

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[Hugo Nebula]

From the chaotic regions of the Cryptosphere, parish wrote on Thu, 21 Aug 2003 01:30:03 +0000:

Not at all. There are many ways of complying with the Building Regulations, and it is down to the designer (architect/ engineer) to make sure that it does. Checking by the BCO does not abrogate the designers of that responsibility, and when it comes to matters which do not adversely affect health, safety or welfare (i.e., finishes, decoration, landscaping, etc), the BCO has no say at all.

Was the site mentioned inspected by the Local Authority or an Approved Inspector (the NHBC)? I don't see any mention of the Council's Building Control in there.

Yes, certainly make sure that your Local Authority Building Control Surveyor inspects the work to make sure it complies with the requirements for health & safety, but they are not liable for consequential financial loss.