Examining Indemnity Insurance: Breaking down More Benefits

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Buying a real estate property involves a lot of documents and insurance policies. As a homebuyer, you need to understand all these complexities. This article will mainly focus on indemnity insurance. By understanding what it is and what it is for, you might make better decisions throughout your conveyancing process. 

What Is Indemnity Insurance?

This insurance policy covers all legal costs and possible expenses for the insured party’s defence once needed. In line with property purchase, indemnity insurance protects the insured party for unexpected losses or damages in the property they purchase, with an assigned limit. 

It is a protection policy that homebuyers usually obtain during the conveyancing process, often recommended by the conveyancer. It typically covers minor issues that could become costly expenses later. As a buyer, you may pay for the policy as a one-off payment.

How Can Indemnity Insurance Protect You?

Let’s start with an example. 

Upon checking your newly purchased house, you might discover that the seller cannot provide you with the certifications you need for existing elements inside the house. Let us say your purchased home comes with an already installed boiler, but the seller cannot provide you with its installation certification. 

Supposedly, this certification should contain all the installation details to help you gauge the boiler’s quality at present. Given the situation, you can expect that the boiler would eventually become damaged and need repair or replacement, but you have no idea when exactly that might happen.

After years, you decide to sell the house. Here is where indemnity insurance takes place. When the new house buyer sues you for the not-working boiler, you are protected against any legal matters they raise. However, you should keep in mind that the insurance itself cannot be used to take care of the boiler’s replacement and repair. 

Sample Scenarios That You Can Get Indemnity Insurance Protection

Here are some instances wherein you can secure indemnity insurance for your protection:

You buy a property without a building regulation certificate. The local authority might pursue a claim against you as the new owner, but indemnity insurance can protect you. 

You purchased a property that was altered without planning permission. It could be a structure at risk, and indemnity insurance can protect you if there are indeed problems in the building.

The windows or doors installed in the house you purchase do not have the FENSA certification required in some locations. 

Suppose you are selling a home and cannot provide the necessary certificates. You can also get indemnity insurance to safeguard yourself. 

If your house crossed someone else’s land without the right of easement, indemnity insurance can also protect you. 

When your property is near a church, you might be liable should the church need repair in the future. Indemnity insurance can take care of the costs. 

Conclusion

Indemnity insurance is a one-time expense that can protect you against any significant future payments that you should not be liable for in the first place. As mentioned above, this insurance is usually recommended by competent conveyancers. If you want to get this type of policy, talk to your conveyancer or solicitor. 

Should you need a conveyancer in Manchester, Conveyancing Expert is here to help. We are your legal expert when it comes to concerns about house purchases. We will make sure that your property transaction is completed with expert legal advice and service. Get your free conveyancing quote today. 

 

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