I'm sure someone must know on here so thought i'd ask!!

Basically i'm about to exchange contracts on my house first and have been asked to make sure that I have a cover note / buildings insurance in place for that date. Surely though the building insurance shouldnt start until the completion date should it otherwise there will be 2 insurance policies on that property at the same time before completion. (current vendors and myself).

Anyone know what the reason for me doing this is? What would happen if a claim needed to be made, who's insurance company would it come from being as i'm not actually living there / completed?

Cheers
Chris

 

Yes the policy has to be in place from the date of exchange as effectively from that date you own the property, the completion date is purely transfer of funds and handover, the seller will do the same to the property they are buying, but even if their insurance is still live they would not claim against it as you would have to.

 

you cant exchange without it, if your buying using a mortgage.

 

I see where your coming from but what for arguments sake we have exchanged contracts, I have the building insurance in place and the current vendor decides she wants to cause damage 'accidently' before completion. Who would be liable? Would I have to claim on my insurance and lose my no claims discount before i've even moved in?

Chris

 

yes, but you would not know anyway until you were given the keys, its a quirk that I was not aware of, or any other people I spoke to until I bought my current house and looked into it. You would have to claim against your insurance and they make a civil claim against the seller.

The other grey one is if you have building and contents together as from the date of exchange your contents ins also gets transfered to the new address, but are actually still located at the old address


edited to say if they burned the house down in between exchange and completion you would still be legally obliged to complete and buy it, in practice your solicitor would have to start earning his money and delay completion

 

exchange & complete at the same time then, all you have to do is ask. It had to be done for 100% mortgages as there was no deposit to pay

 

you need to have insruance so that if the place isn't worth what it's being boguht for the mortgage lender has someone to bill for the shortfall should anything happen to it

they won't exchange without it realistically, and there will be no completion thats for sure as they won't hand you the keys