The latest Consilium product has landed!
You will now be able to source Latent Defect cover from us for your clients.
Having a Latent Defect policy is essential for developers looking to protect themselves against some defects found with a newly built/refurbished property that emerge 2-10 years after completion.
However, there are several important steps to follow if you want to ensure the right level of protection for your client on their next construction project.
The first golden rule is to submit the application as early as possible – ideally before any construction work has started.
By doing this, it means our surveyors can get involved with the project from the outset, giving them full knowledge of the plans, and the opportunity to offer advice where necessary. If construction is already underway when inspections are carried out, the surveyor is reliant on the builder/developer telling them what work they’ve already undertaken, and this will increase the premium. In short, the closer the project is to completion, the higher the premium.
If the project is underway when the enquiry is made with us, we can still assist with placement, but we may need an explanation as to why a policy wasn’t sought pre-construction.
A second point to be aware of is that your client must have a Building Control certificate in order to get a policy.
To this end, we can help. Working with us and our markets, the surveyor sent to inspect the construction site can also grant the Building Control certificate, saving time, and generating another cost saving on the warranty premium.
If you’ve done all the above, and approached us early with your enquiry, the premium will largely come down to the reinstatement value of the property and the builder.
It goes without saying that for every enquiry we need to know exactly what is getting built and where, but it’s also very important we get as much information about the builder, from the company name and reg number, to a full CV including their portfolio of past work.
Doing this will support a quicker turnaround and possibly a better premium.
One final point for brokers. Housing developers are a key client that will often apply for these policies, but brokers with builders, architects, homeowners, or housing associations on their books should also be recommending Latent Defect cover. If you don’t, your competitor may?
Only one policy per project is needed, and we will work with the broker that comes to us first for each project.
The broker gains by successfully placing a policy and the subsequent earnings, but the client making the application also gains a saving. This may seem counterintuitive when the client is paying, but for example, a builder will add the cost to the final bill that they quote to the developer. Similarly, a homeowner could make a saving by purchasing the cover themselves, rather than allowing the developer to add it to their fee.
Our risk appetite is wide in this class, in addition to new builds and renovations, we can source cover for apartment blocks, commercial units, barn conversions (if work hasn’t started), mixed use properties, modern methods of construction, and retrospective cover on a fully built property.
Our strong market connections, allow us to offer 10-year structural warranty policies, or 12-year policies if it applies to social or affordable housing.
Policies are issued on a per risk basis, up to £10m on any one continuous structure. However, talk to us, as higher limits may be available on referral.
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