Lender requirements to be noted on contractors insurance policy??

[Kings]

Hi wonder if you can help.

we are just about to start a self build using a main contractor for all the works. (Single resi  unit build costs less than 500k)

we have a build warranty in place for once completed and he has a tradesman insurance including contractors all risks for build.

our self build lender is insisting that they are named on the policy as having a financial interest.

axa who provide the tradesman cover to our contractor will not add their interest.

do I need to buy another policy where we can get the lender noted? Is this normal?

 

my concern then is that I and the contractor are both covering the same thing and who would claim in the event of a loss.

ie the house burns down. I go to claim the insurance company say that it is insured twice so the want to split the claim costs. In which case the lenders interest is only noted on half so they may not be happy with that?

 

can anybody let me know how this is resolved normally.

 

was hoping to complete on mortgage this week and this is setting me back. So keen to resolve.

thanks

kerri 

 

[Russell griffiths]

You should have self build insurance yourself. 

For instance, if a nosey neighbour wanders in and falls down a hole who’s he claiming off

if lighting strikes your unfinished house and it burned to the ground. 

 

[Temp]

Doesn't help but Google suggests it's pointless them asking to be noted on the policy...

 

http://www.robertgerrard.com/2018/09/noting-an-interest-on-an-insurance-policy-is-it-necessary/

 

 

[Temp]

 

9 hours ago, Russell griffiths said:

You should have self build insurance yourself. 

For instance, if a nosey neighbour wanders in and falls down a hole who’s he claiming off

if lighting strikes your unfinished house and it burned to the ground. 

 

 

+1

 

Edited February 15, 2020 by Temp

[Temp]

Just curious but does your lender also offer house insurance? I know they probably don't cover plots but it might be worth giving them a call pretending to need house insurance and ask if they can note a lender on their own policy. If they say no it might give you ammunition to get the requirement removed.

 

 

[PeterW]

Contractor all risk only really covers them for work on site when they are there - if the structure falls down in the night due to high winds (ask @AnonymousBosch about this ...) then his insurer won’t cover you. 
 

He would need to take out a works in progress extension to cover it, and that would be probably the same price as you taking self build insurance. It will be £5-700 but in the event of an issue you will be thankful you did. 

[Kings]

Hi thanks for you advice above. I am now trying to find out which JCT contract I should use. Home owner contract. intermediate or building contract JCT. this is is just for our resi new build with not contract administrator. Any advice?