Buying your home can be an extremely fraught process. There are so many details you need to stay on top of and it may all seem completely overwhelming.
Although it is a process through which millions of others have completed before you, there are still potentially grey areas and details which it might be easy to overlook in all the apparent complexity of purchasing your home and making arrangements to move in.
Exchange of contracts
One such potentially grey area is the responsibility for arranging insurance of the property once contracts have been exchanged.
You have signed a contract committing you to making the purchase, but the home is not yet yours until the conveyance is completed. So, who is responsible for arranging building insurance in the period between exchange and completion? Some indication of the confusion which exists might be gauged from the exchange of comments in a thread published by the Money Saving Expert.
Clearly, it is important that insurance cover remains in place and that failure to do so may lead to a very substantial loss. Since it is a purchase to which you have committed upon exchanging contracts, it is usual for you, the buyer, to be responsible for the necessary building insurance – to protect the property against such potentially major risks as fire, storm damage, flooding, impacts, theft and vandalism.
Your solicitor is likely to insist that you arrange such insurance and some solicitors or conveyancers might make it a condition of accepting your instructions to act for you in the purchase.
Short term insurance
Until the home is actually yours, however, you are only likely to need short term buildings insurance between exchange and completion – instead of the full 12-month cover commonly required for regular home insurance.
The length of time between exchange and completion is notoriously difficult to predict – it might be six weeks or the interval might stretch into several months, depending on any glitches or holdups that might occur. In any event, it is extremely rare for this period to extend to anything like the full calendar year for which regular building insurance is typically required.
If you need home insurance for three months, let’s say, you are unlikely to want to commit to a full year of regular insurance until after you have moved in, have been able to take stock and decided to combine both building and contents insurance under the same umbrella policy.
Here at UKinsuranceNET, we are specialists in the provision of this particular type of short term insurance.
It is a specialist type of insurance because many home insurers might decline insurance cover during the period between exchange and completion since you are not living in the property – in other words, it might be standing empty and unoccupied.
For specialist cover such as this, cover needs to start the moment you exchange contracts, but there might then follow an indeterminate period until completion. Short term buildings insurance between exchange and completion is typically sufficiently flexible for you to extend the period of cover if there is some unexpected holdup – thus ensuring that the home you are about to move into remains adequately protected.