Unknown Rights and Easements Indemnity Insurance Bank conveyancing requirements
RBS and Birmingham Midshires, in common with most banks, set their own specific instructions when it comes to unknown rights and easements indemnity insurance. The content herein aims to help conveyancing firms on the various mortgage company approved list of panel lawyers where the title for the the property to be mortgaged contains unknown rights and easements. Solicitors should still check the Council of Mortgage Lenders’ handbook requirements for each mortgage company, for example Halifax, Barnsley BS or Bank of Scotland. The information 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?
Santander and Yorkshire Building Society in common with the majority of banks, instructions are such that where unknown rights and easements indemnity insurance is to be put on risk:
- the unknown rights and easements indemnity insurance policy needs to be for the benefit of the lender and, if possible, for the benefit of the borrower and any next registered proprietor or mortgage company. If the borrower will not be protected by the unknown rights and easements indemnity insurance policy, the mortgagor needs to be advised accordingly.
- you are responsible for approving the terms of the unknown rights and easements policy on behalf of the mortgage company
- your firm is obliged to reveal to the insurer all relevant information which you have obtained
- the unknown rights and easements indemnity insurance policy should not contain terms that you are aware would invalidate or compromise the interests of the bank
- your practice is duty bound to explain 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 mortgagor should notify the bank of any notice or potential claim in relation to the policy
- the minimum level of cover for the policy must satisfy the requirements for the mortgage company (see UK Finance Lenders’ Handbook Part 2 )
- you must supply a copy of the unknown rights and easements indemnity insurance to the mortgagor and explain to the mortgagor why the unknown rights and easements indemnity insurance policy was effected and that a further policy might be mandatory if there is further lending against the mortgaged property
- the unknown rights and easements indemnity insurance policy should be effected without expense to the mortgage company
| Lender | Requirement |
|---|---|
| Adam & Company | The open market value of the property according to the valuation report. |
| Adam & Company International | The open market value of the property according to the valuation report. |
| Allied Irish Bank | At least the amount of the mortgage advance. |
| Birmingham Bank | Please contact Head of Operations to discuss (Jackie Burchill) |
| DB UK Bank | An amount at least equal to the mortgage advance or credit limit, whichever the higher. The policy must be assignable |
| Family Building Society | An amount at least equal to the mortgage advance. |
| Handelsbanken | Purchase price or 110% of mortgage advance, whichever is the greater. |
| Harpenden Building Society | 110% of mortgage advance |
| 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. |
| Holmesdale Building Society | 110% |
| Kent Reliance | An amount at least equal to 110% of the mortgage valuation. |
| Platform | 110% of principal sum. |
| 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). |
| Santander | The purchase price or (if lower) 110% of the mortgage advance. |
| 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. |
| Royal Bank of Scotland | An amount equal to the value of the property. |
| RBS - Direct Line One | An amount equal to the value of the property. |
| RBS - Virgin One | An amount equal to the value of the property. |
| Ulster Bank | 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 explained in the policy document. Conveyancing Practitioners should direct the borrower to the unknown rights and easements indemnity insurance policy document. Unknown Rights and Easements indemnity insurance is devised to provide indemnity in respect of the risks specified in the policy schedule - so it is essential check the schedule to ensure it is in order. The continuance of this non-investment insurance contract is in perpetuity unless otherwise stated in the unknown rights and easements indemnity insurance policy. Again, please check that this is as you expected.Unknown Rights and Easements Contingency insurance: Significant aspects 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 Policies are likely to cover the following- All other costs and expenses incurred by the Insured with the written consent of the relevant insurance company
- Cover for compensation incurred in any action in respect of the risks specified in the unknown rights and easements policy, including solicitors charges.
- Expenses for works (including architects’ and surveyors’ fees) for the purpose of the development started, prior to proceedings for the enforcement of the risks specified in the unknown rights and easements policy, to the extent that such costs are rendered abortive by court order.
- Market value reduction resulting from the successful enforcement of the risks specified in the unknown rights and easements policy.
- The out of pocket expenses 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.
- All sums paid with the written consent of the insurance company to free the property from the risks specified in the unknown rights and easements policy.
You also need to be sure that the answers on the application form are correct. Regardless of how remote a claim on the mortgage company insurance policy might be you can be sure that the insurer will check the details on any proposal form thoroughly before any claim is paid out.
Other considerations for unknown rights and easements indemnity insurance
There may be consequences arising from the enforcement of the risks identified in the unknown rights and easements indemnity insurance which are not adequately covered by financial compensation. Information provided on this webpage is for general information for conveyancers and solicitors in England and Wales on the the bank conveyancing 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 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 above information covers to properties in England and Wales.