Lender conveyancing panel requirements re Missing Landlord Indemnity Insurance

Chelsea BS and Halifax, as with the majority of banks, set their own requirements when it comes to missing landlord indemnity insurance. The purpose of this page to assist conveyancing solicitors on the different mortgage company conveyancing panel where the title to be charged contains missing landlord. Lawyers are advised to familiarise themselves with the CML handbook requirements for each mortgage company, for example Virgin Money, Coventry BS or Nationwide. The information on this page is not focused on missing landlord indemnity insurance requirements.

Need help with missing landlord indemnity insurance from your lender?


RBS and Yorkshire Building Society in common with most mortgage companies, requirements are that where missing landlord indemnity insurance is to be put on risk:

  • you must explain to the mortgagor that the borrower is obliged to adhere to any conditions of the missing landlord indemnity insurance policy and that the mortgagor should notify the bank of any notice or potential claim in respect of the policy
  • your practice must approve the terms of the missing landlord policy on behalf of the lender
  • the missing landlord indemnity insurance policy must be in favor of the lender and, if possible, in favour of the mortgagor and any future owner or mortgage company. If the mortgagor will not be covered by the missing landlord indemnity insurance policy, you must advise the mortgagor of this fact.
  • your practice is required to reveal to the insurer all relevant information which you have gathered
  • the limit of indemnity must meet the requirements for the mortgage company (See Part II Handbook requirements )
  • the missing landlord indemnity insurance policy should be effected at no expense to the bank
  • the missing landlord indemnity insurance policy must not incorporate conditions which you recognise would invalidate or prejudice the interests of the mortgage company
  • you must provide a duplicate of the missing landlord indemnity insurance to the borrower and explain to the borrower why the missing landlord indemnity insurance policy was effected and that additional insurance could be mandatory if there is further borrowing against the mortgaged property
Regarding the extent of cover for the missing landlord indemnity insurance policy (or for that matter any indemnity insurance), consider the following sampling of Section 9.2 of the CML handbook PII requirements for banks:
Lender Requirement
Accord Mortgages An amount at least equal to the amount of the mortgage advance. Any indemnity insurance policy must protect the borrowers, any successors in title and any mortgagee.
First Direct The value of the insurance must be for at least the full value of the property
GE Money GE Money Home Lending has withdrawn from the UK mortgage market.
Habito Higher of purchase price or valuation
Hodge An amount equal to the purchase price or value, whichever is higher. Any indemnity insurance policy must be for our benefit, that of any transferee/assignee (legal or equitable) of the mortgage, the borrower(s) and any successor in Title.
Hodge Equity Release An amount equal to the purchase price or value, whichever is higher. Any indemnity insurance policy must be for our benefit, that of any transferee/assignee (legal or equitable) of the mortgage, the borrower(s) and any successor in Title.
Kent Reliance An amount at least equal to 110% of the mortgage valuation.
Keystone Property Finance An amount equal to 110% of the valuation or purchase price - whichever is the greater
MPowered Mortgages Either the minimum reinstatement value or where there is no valuation the market value/purchase price figure (whichever is higher).
Manchester Building Society Purchases- higher of the Purchase price & valuation
Re-mortgages- Loan x 115%.
Reliance Bank \xA31,000,000.00
Saffron Building Society Higher of purchase price or valuation.

Any indemnity insurance policy must be for our benefit, that of any transferee/assignee (legal or equitable) of the mortgage and also the borrower(s).
Scottish Building Society Amount of mortgage plus 25%.
Scottish Widows The value of the property.
St James Place An amount at least equal to the total of the initial mortgage advance plus any pre-agreed reserve. These amounts will be shown in the mortgage offer.
TSB The value of the property
The Mortgage Lender An amount at least equal to the mortgage advance.
RBS - Direct Line An amount equal to the value of the property.
RBS - Direct Line One An amount equal to the value of the property.
Yorkshire Bank Open market value of property.

General Missing Landlord indemnity insurance points to consider

The extent of the terms for missing landlord indemnity insurance are identified in the policy paperwork. Conveyancing solicitors are obliged to point the borrower to the missing landlord indemnity insurance policy paperwork. The intention of missing landlord indemnity insurance is to provide indemnity in respect of the risks specified in the policy schedule - so you should check any draft to determine that it is as it should be. The lifetime of this non-investment insurance agreement is in perpetuity unless otherwise stated in the missing landlord indemnity insurance policy. It is well worth checking that the time frame is correct.

Significant characteristics and benefits of missing landlord Contingency insurance :

Protection via such a policy is to cover the risk of third parties looking to enforce rights that can affect the use of a property. Missing Landlord indemnity insurance Cover normally includes
  • Market value reduction resulting from the successful enforcement of the risks specified in the missing landlord insurance.
  • Expenses for works (including professional fees) for the purpose of the development started, prior to proceedings for the enforcement of the risks specified in the missing landlord indemnity insurance, to the extent that such costs are rendered abortive by court decision.
  • Money paid with consent in writing from the insurance company to liberate the land from the risks specified in the missing landlord policy.
  • Reimbursement for compensation incurred in any proceedings concerning the risks specified in the missing landlord insurance, as well as solicitors charges.
  • The out of pocket expenses of altering or demolishing 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

As is the case with all conventional insurance, all material information needs to be disclosed to the insurance company at the outset and throughout the policy term, otherwise the missing landlord policy will be invalidated.

Other considerations for missing landlord indemnity insurance

Missing Landlord insurance may satisfy lenders such as Godiva Mortgages or Barclays and prevent clients from from suffering financially but it cannot compensate for the stress and inconvenience the emotional suffering - after all the value of a home cannot always be measured in cash in the eyes of the owner.
Content on this webpage is for general information for conveyancers and solicitors in England and Wales on the the lender approved panel, it does not constitute advice for members of the public who should contact their lawyer for advice relating to the bank 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 missing landlord 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 covers to properties in England and Wales.