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In summary, it is an insurance taken out in respect of specific new-build premises to provide cover in the event of an inherent defect in the design, workmanship or materials becoming apparent after practical completion.
Reviewing competitor online literature and search engine listings there are references to Structural Defects Insurance, Latent Defects Insurance, Building Warranty, New Home Warranty, Self-Build Insurance or Structural Warranty in equal measure. They all refer to the same product which is an insurance taken out in respect of specific new-build premises to provide cover in the event of an inherent defect in the design, workmanship or materials becoming apparent after practical completion.

The most immediate reason the Structural Warranty Insurance policy is bought is because mortgage lenders will generally only lend on a newly built (or newly converted) property where the property is covered by such protection.

Each lender has its own list of Structural Warranty Insurance policies that they will accept. These are listed online within the Council of Mortgage Lenders website and is regularly updated with new lenders; new Structural Warranty Insurance policies and existing lenders reviewing which policies to retain or exclude. It is worth consulting this list as some lenders have specific criteria they will and won’t accept, including self-build, retrospectively issued policies, max units per site

Typically the Structural Warranty Insurance is bought by Property Developers or Construction Companies who are actually building the new home and then passed onto the new property owner, at no additional cost, as part of the sale documents. Most Structural warranty polices allow them to be freely reassigned to the initial and subsequent home owner. These could be an individual living in the property as an owner occupier, as well as being a private or social landlord who will be rent out the newly built units. Hence the typical policy holder might also include private developers, financial institutions, Housing Associations.

There are two factors to bear in mind when buying a Structural warranty Insurance policy:

  • The financial stability of the Insurer (as denoted by its ‘rating’) behind the insurance policy. Most of the Insurers offering this product are ‘A’ rated
  • The acceptability of the Structural Insurance policy amongst mortgage lenders. The greater the acceptability, the wider the choice for new homeowners to take a mortgage.

Although the specifics may vary between providers, the most common are around the details of the Property developer/ SPV, other building professionals involved in the project (i.e. Builder/ Contractor/ Structural Engineer; Architect/ Building Control).

You will also have to provide details of development with some supporting documents, for example:

  • Proposed Site plan
  • Proposed plans (Floor/ Elevations/ Sections)
  • Structural Calcs and details
  • Ground Condition Report
  • Method Statement

In the case of Conversion/ Refurbishments you may be asked to provide

  • Current floor and roof plans
  • Current Elevation/ Sections
  • Schedule of Works
  • Structural Engineers report

We suggest three key things:

  1. Start interacting with Heathwood’s earlier rather than later. You don’t need much information to get a quote and it will flush out any questions the insurer might have with your development.
  2. Complete the Proposal Form as fully as possible the first time. Providing a full set of supporting documents is more likely to get Formal Quote quickly and reduce chance of referral to Insurer. Providing part answers or only some of the documents could frustrate the administration process and lead the Insurer to ask more questions.
  3. Communicate regularly with your Structural Defects surveyor
    • Share the build-programme plan
    • Agree visit schedule up front and update with any changes
    • Accommodate the visit when on site
    • Read the Surveyor reports and follow up any points raised immediately
    • Provide documents required upon completion
Have a question?

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