Mortgage Company conveyancing panel requirements re Maisonette Indemnity Insurance
Virgin Money and Chelsea BS, as with many banks, set their own requirements when it comes to maisonette indemnity insurance. This page is designed to help conveyancing firms on the various mortgage company approved list of panel lawyers where the title for the the property to be mortgaged includes maisonette. It is not a substitute for checking the CML handbook requirements for each lender, be it Accord, HSBC or Natwest. The content on this page Is not to be read as maisonette indemnity insurance advice.
Need help with maisonette indemnity insurance from your lender?
RBS and Skipton in common with many lenders, requirements are that where maisonette indemnity insurance is effected:
- your practice must supply a duplicate of the maisonette indemnity insurance to the borrower and explain to the mortgagor why the maisonette indemnity insurance policy was effected and that a further policy might be required if there is further lending against the mortgaged property
- the maisonette indemnity insurance policy should always be in favor of the bank and, if possible, for the benefit of the mortgagor and any future registered proprietor or mortgagee. If the mortgagor will not be covered by the maisonette indemnity insurance policy, the mortgagor must be advised accordingly.
- the level of indemnity must meet the requirements for the mortgage company (See Part II Handbook requirements )
- the maisonette indemnity insurance policy must be placed on risk without expense to the lender
- your firm are responsible for approving the terms of the maisonette policy on behalf of the mortgage company
- you must point out to the mortgagor that the borrower will need to adhere to any conditions of the maisonette indemnity insurance policy and that the mortgagor should notify the mortgage company of any notice or potential claim in respect of the insurance
- your firm must reveal to the insurer all relevant information which you have acquired
- the maisonette indemnity insurance policy must not incorporate conditions which you recognise would invalidate or prejudice the interests of the lender
| Lender | Requirement |
|---|---|
| Better HomeOwnership | An amount to cover the mortgage advance as a minimum. |
| Darlington Building Society | The higher of value or purchase price of the property. |
| GE Money | GE Money Home Lending has withdrawn from the UK mortgage market. |
| Hampden | The open market value of the property according to the valuation report. |
| Harpenden Building Society | 110% of mortgage advance |
| Hinckley and Rugby | The policy must be for our benefit and for no less than the amount lent to the borrower, including retentions, stage payments and interest. |
| Holmesdale Building Society | 110% |
| JPMorgan | 110% of principal sum. |
| Landbay Partners | An amount equal to 100% of the property valuation or purchase price (whichever is greater) plus 10%. |
| Mortgage Agency Services | 110% of the purchase price or valuation, whichever is greater |
| New Street Mortgages | Must be for a minimum of 110% of the purchase price or valuation whichever is the greatest. |
| Precise Mortgages | An amount at least equal to 110% of the mortgage valuation. |
| Reliance Bank | \xA31,000,000.00 |
| Scottish Widows | The value of the property. |
| Skipton Building Society | For lender only cover we will accept a minimum of 110% (index-linked) of the amount of the loan. |
| Swansea Building Society | Purchase price or market valuation whichever is the higher |
| Tandem Bank | An amount at least equal to 110% of the purchase price or valuation – whichever is the greater. |
| Tipton Coseley Building Society | Minimum of mortgage advance. |
| Ulster Bank | An amount equal to the value of the property. |
| Whistletree | The value of the property |
General Maisonette indemnity insurance points to consider
The full terms, conditions and exclusions for maisonette indemnity insurance are set out in the policy document. Conveyancing Practitioners are obliged to point the borrower to the maisonette indemnity insurance policy paperwork. The intention of maisonette indemnity insurance is to afford indemnity in respect of the risks set out in the policy schedule - so it’s important to check the document to ensure it is in order. The continuance of this non-investment insurance agreement is in perpetuity unless the policy says something to the contrary. Again, please check that this is as you expected.Maisonette indemnity insurance: Significant features and benefits:
The insurance will normally cover where someone claims to be entitled to the benefit of the specified risks, stated in the maisonette indemnity insurance schedule. Maisonette indemnity insurance Policies should be checked for the following- Loss in market value resulting from the successful enforcement of the risks specified in the maisonette insurance.
- The cost of works (including professional fees) for the purpose of the development started, prior to proceedings for the enforcement of the risks specified in the maisonette indemnity insurance, to the extent that such costs are rendered abortive by court decision.
- The cost of altering or destroying all, or part of the development and the reinstatement of the land, insofar as such alteration, demolition or re-instatement is made necessary by court order.
- All ancillary costs and expenses incurred by the Insured with consent in writing from the relevant insurance company
- All sums paid with consent in writing from the insurance company to free the land from the risks specified in the maisonette indemnity insurance.
- Cover for compensation incurred in any proceedings concerning the risks specified in the maisonette indemnity insurance, as well as legal and associated costs.
Don't forget to consider what is not included in the maisonette insurance e.g. does the policy cover any property that has been altered within the year prior to the policy being put on risk? Are legal costs covered?
Additional considerations for maisonette indemnity insurance
Bear in mind, that if a covenant is breached and changes have to be made, simply getting monetary compensation from maisonette insurance may be adequate for your client. Content on this webpage is for general information for conveyancers and solicitors in England and Wales on the the lender conveyancing panel, it does not constitute advice for members of the public who should contact their lawyer for advice relating to the mortgage company indemnity insurance. Whilst we endeavour to keep the information up to date and correct we do not make any representation or warranties of any kind about its completeness, accuracy, reliability or suitability. Any reliance you place on the information is strictly at your own risk. Lexsure will not be liable for any direct or indirect loss or damage arising out of or in connection with the use of this information.
An important exclusion applying to most maisonette Policies is if you make any contact with any party who might cause a claim under the Policy, it can invalidate the cover.
The above information is in relation to properties in England and Wales.