Unknown Rights and Easements Indemnity Insurance Lender conveyancing requirements
Lloyds TSB and Barnsley BS, as with many banks, have their own specific instructions when it comes to unknown rights and easements indemnity insurance. The content herein aims to help property law lawyers on the various mortgage company approved list of panel lawyers where the title to be charged includes unknown rights and easements. It is not a substitute for checking the CML handbook requirements for each bank, be it Barclays, Natwest or Yorkshire Building Society. The content on this page Is not to be read as unknown rights and easements indemnity insurance advice.
Need help with unknown rights and easements indemnity insurance from your lender?
Coventry BS and Chelsea BS like many mortgage companies, obligations require that where unknown rights and easements indemnity insurance is effected:
- the minimum level of cover for the policy must satisfy the requirements for the mortgage company (See Part II Handbook requirements )
- you are responsible for approving the terms of the unknown rights and easements policy on behalf of the lender
- the unknown rights and easements indemnity insurance policy should be placed on risk without cost to the mortgage company
- you is required to disclose to the insurer all relevant information which you have gathered
- your firm must supply a copy of the unknown rights and easements indemnity insurance to the mortgagor and explain to the borrower why the unknown rights and easements indemnity insurance policy was effected and that a further policy could be required if there is further lending against the security of the property
- the unknown rights and easements indemnity insurance policy must not incorporate conditions which you know would invalidate or compromise the interests of the bank
- your firm must point out to the mortgagor that the borrower will need to adhere to any conditions of the unknown rights and easements indemnity insurance policy and that the borrower should notify the lender of any notice or potential claim in respect of the policy
- the unknown rights and easements indemnity insurance policy must be in favor of the mortgage company and, if possible, in favour of the borrower and any future registered proprietor or mortgagee. Where the borrower will not be covered by the unknown rights and easements indemnity insurance policy, the borrower must be advised accordingly.
| Lender | Requirement |
|---|---|
| Adam & Company | The open market value of the property according to the valuation report. |
| April Mortgages | An amount at least equal to the mortgage advance. |
| Bank of Scotland | Not less than mortgage advance plus 10% |
| Bank of Scotland Private | [This lender has not published an answer to this question. Please contact the lender.]
|
| Coutts & Co | The open market value of the property according to the valuation report. |
| Coventry Building Society | Minimum of the value of the property. |
| Hampden | The open market value of the property according to the valuation report. |
| Investec | The open market value of the property according to the valuation report. |
| Kensington Mortgage | Must be for a minimum of 110% of the purchase price or valuation whichever is the greatest. |
| Market Harborough Building Society | Purchase price or valuation - higher of the two |
| Perenna | The higher of the purchase price or valuation. |
| Rooftop Mortgages | The value of the property for mortgage purposes as disclosed in the valuation. |
| Sainsbury's Bank | An amount equal to the higher of the value of the property or the purchase price. |
| Santander | The purchase price or (if lower) 110% of the mortgage advance. |
| 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. |
| RBS (One Account) | An amount equal to the value of the property. |
| RBS - Virgin One | An amount equal to the value of the property. |
| Whistletree | The value of the property |
Non lender-specific considerations
The extent of the terms for unknown rights and easements indemnity insurance are identified in the policy document. Property lawyers are obliged to direct your non-lender client to the unknown rights and easements indemnity insurance policy document. Unknown Rights and Easements indemnity insurance is designed to provide indemnity in respect of the risks specified in the policy schedule - so it is essential check any draft to determine that it is correct. The lifetime of this non-investment insurance contract is in perpetuity unless otherwise stated in the unknown rights and easements indemnity insurance policy. It is well worth checking that the time frame is correct.Unknown Rights and Easements Contingency insurance: Important features and benefits:
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. Unknown Rights and Easements indemnity insurance Cover normally includes- All other costs and expenses incurred by the Insured with the written consent of the relevant insurer
- Expenses for works (including professional fees) for the purpose of the development commenced, before the commencement of proceedings for the enforcement of the risks specified in the unknown rights and easements insurance, to the extent that such costs are rendered abortive by court order.
- Money paid with the written consent of the insurance company to liberate the land from the risks specified in the unknown rights and easements policy.
- Liability for damages or compensation incurred in any action regarding the risks specified in the unknown rights and easements insurance, including legal and associated costs.
- Market value reduction resulting from the successful enforcement of the risks specified in the unknown rights and easements insurance.
- The cost of altering or taking down 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.
You also need to be sure that the answers on the application form are accurate. However remote the likelihood of a claim on the lender insurance policy might be you can rest assured that the insurer will check the details on any proposal form very carefully before any claim is admitted.
Supplemental considerations for unknown rights and easements indemnity insurance
Unknown Rights and Easements Indemnity policies can provide effective protection, but non-lender clients should be asked to give pause for thought and consider that the consequences of not being able to enjoy the property as anticipated may mean that unknown rights and easements indemnity cover will not necessarily be the answer. Content on this webpage is for general information for Regulated law firms 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 lender 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 unknown rights and easements Policies is if you make any contact with any party who might cause a claim under the Policy, it can invalidate the cover.
The content set out above covers to properties in England and Wales.