Home Buyers Protection Insurance Comparison UK in 2021

Home Buyers Protection Insurance UK up to £2,500

From just £69!

Home buyers protection insurance Comparison

Updated by Eamonn on 20 Nov 2021

Buying your first house or moving to a  different residence can be fraught with stress. One day everything is running smoothly and the next the chain is broken. Apart from the gloom of a deal falling through, you most likely have solicitor and others fees which are non-recoverable.  This is the purpose behind home buyers insurance, a policy that is built to protect these additional costs that you have burdened and these can be substantial. The risk of a deal falling is real for first time buyers even experienced buy to let investor

It does not matter whether you are a first-time buyer or an experienced buy-to-let investor, these issues are part and parcel of the home-buying process.

home buyers protection insurance uK

Why you need Home Buyers Protection Insurance

Research carried out by Which in 2016 revealed that 3 out of 10 property sales fell through, that is nearly one in three. Whilst 16% did not lose out financially, the remainder did lose a substantial amount due to survey fees and brokering costs. The average loss was   £1,000 with 5% losing a whopping £5,000 and above. Property chains contributed the most to failed sales. If able, it is best to avoid properties that in a chain. This includes properties that the owner had died or the vendor's second home and is currently vacant.   

Does buyers protection include conveyancing insurance?

Home buyers insurance does include conveyancing insurance and more.  The policy will enable you to recover conveyancing fees, valuation fees and mortgage or lender fees, to the values agreed within the policy. 

  • Total Cover Amount Split  : Cover up to £2,250
  • Conveyancing fees : Conveyancing fees up to £1,100
  • Valuation fees : Survey and Valuation up to £750
  • Lender Fees: Lenders fees up to £400

Is this product available to landlords in addition to home buyers?

This product is also suitable for landlords buying a new property too. This makes it perfect for the purchase of buy to let properties or just a home buyer buying their first property or moving up the housing ladder. 

If you are a landlord, we can also provide competitive quotes for landlord home emergency cover, starting from 89 for £12months.

When should I buy Home Buyers Insurance

As soon as possible after your offer has been accepted. The policy will only become valid after it has been purchased, and it will be backdated to the date the offer was accepted. The cover is valid for 180 days from the start date of cover.

What is included in Home Buyers Protection insurance?

Buying a home is stressful enough without the financial worry of a sale falling through. Home Buyers' Protection Insurance helps cover legal, survey and mortgage lending costs should your purchase fall through.

  • Gazumping : if the seller (vendor) withdraws from the sale as a result of receiving and accepting an alternative offer in excess of  £1,000 
  • Vendor Withdraws : If the vendor withdraws from the sale for any reason
  • Lender or Banks evaluation: If the lender values the property at 90% less than your offer  
  • Structural defects : Structural faults discovered that reduces the appraisal price to 10% or below the price you offered.
  • Terminal illness : If you are diagnosed with a terminal illness, and you change your mind on proceeding
  • Redundancy : Loss of job changes your position on proceeding
  • Property Damage : The property is damaged resulting valuation being reduced by10% or more. 
  • Adverse Legal Search : If the survey uncovers the need for significant remedial work.
  • Lender Withdraws : Mortgage lenders withdrawing their offer

2 Key Reason Why House Sales Fall Through

Break in property change

For a property transaction to be successful, the buyer and seller must first agree on a sale price. Most buyers are not first time buyers and in order to complete the purchase they will need to complete the sale of their existing property. This creates a chain that depends on the successful sale of buyer's existing policy. If any transaction in the chain is delayed, this will impact all in the chain. A typical example of delay is if one buyer in the chain can not gt approval for a mortgage.  A prolonged delay can easily result in the seller returning the property to the marketplace or accepting another offer.   

Gazumping

Gazumping is simply when the sellers accepts a better offer before contracts are signed. This unfortunately is common in England and Wales and the buyer will not only lose out on the property, but also any conveyancing and survey fees. 

Home buyers protection Insurance is it worth it

Now that you understand the purpose and average cost  of home buyers insurance you must decide is it worth it.  Take into account that removing the risk of financial loss will make the house buying process a little less stressful.

Who Provides buyers protection Insurance in the UK

Oops and Surewise over different levels of buyers cover. For comparison purposes the top level of cover for each  is  illustrated in table below. Surewise home buyer's insurance does make any reference on covering for lending fees. Lending fees are fee's levied by the lender to process your application

ProviderExcessConveyancing feesSurvey & Valuation feesMortgage arrangement Lender Fees 
Oops PlatinumNo excessup to £1,100up to £750up to £400
Homeowners allianceNo excessup to £750up to£500up to £250
Legal Generalup to £800up to £550up to £150
Surewise Gold£125 up to £1250up to £1000Not Mentioned

What is Gazumping?

Gazumping is less common, but when house prices are on the rise it can be quite common. The term is used to describe the situation in which you have come to an agreement with the vendor on the sale price. The buyer and seller (vendor) have verbally agreed on the sale. The next stage is the signing of contracts to finalise the sale. During this period, the vendor may receive a much better offer, if they accept you have been gazumped. When it comes to money, ethics can take a back seat. The good news is that home buyers protection insurance will protect you in such a situation, taking care of any costs that you had incurred.

How Can I protect against Gazumping?

Gazumping is legal and the only way to protect yourself is to purchase  home buyer's protection insurance which includes cover if you are gazumped. Different brokers provide polices with slight variations in price and level of cover in each section, but all provide cover for lost conveyancing fees, survey fees and other costs directly related to the house purchase costs.

Gazumping is less likely to occur if you can move quickly with the house purchase. In order to complete quickly, don't; drag your feet  or let anybody in the chain make delays. Be proactive by getting a mortgage agreement in place, a solicitor on standby and any necessary certificates or documents. 

Even with all these precautions, a third party can still make a higher offer to the sales agent. The estate agency by law must pass on this offer, even if the seller has already accepted your offer. If all these precautions fail, you can then fall back on your home buyers policy against the house purchase falling through to cover your expenses. 

2 Levels of cover available Platinum or Gold

Gold Cover

  • Conveyancing Fees :  up to £1,100.00
  • Survey and Valuation Fees : up to £750.00.
  • Mortgage Arrangement and Lender’s Fees : up to £300.00
  • Maximum Cover : up to £2,250.00

Platinum Cover

  • Conveyancing Fees : up to £800.00
  • Survey and Valuation Fees : up to £550.00
  • Mortgage Arrangement and Lender’s Fees : up to £300.00
  • Maximum Cover : up to £1,650.00

What is not covered in home buyers insurance

  • Any costs prior to start date of the policy
  • Costs and expenses are not covered if you simply withdraw from sale.
  • Costs and expenses are not covered If you were aware that sale would not proceed as a result of a property survey within the last 90days.
  • If you volunteer for redundancy, you will not be able to claim on the policy
  • Changing your mind. If you simply decide to withdraw from the sale if you realise this is not the house for you and wish to continue searching for that perfect home. The policy will not pay out nor is it reasonable to expect the policy to pay out under such circumstances. 
  • If you purposely delay the process to such an extent that the vendor withdraws, the policy will not pay out.  

FAQ House Buyers Cover

This section contains answers to frequently asked questions by customer that have applied for buyers protection insurance. It is intended as a quick reference guide and is not part of any insurance policy. It is important to read the full policy wording prior to the purchase of any insurance product, including home buyers' insurance UK.  

Is there an excess?

An excess is an amount that you would be deemed liable for. For example when you rent a car or van you most likely  have an excess that will not be paid by the insurance company. The good news with this house buyers insurance policy, no excess exists. As such, your costs will be reimbursed in full.

What is the difference between Gold Cover and Platinum Cover?

Gold CoverPlatinum Cover
Conveyancing Fees : up to £1,100.00Conveyancing Fees : up to £800
Survey and Valuation Fees : up to £750.00.Survey and Valuation Fees : up to £550.00.
Mortgage Arrangement and Lender’s Fees : up to £300.00Mortgage Arrangement and Lender’s Fees : up to £300.00
Maximum Cover : up to £2,250.00Maximum Cover : up to £1,650

Can I increase any section of the cover?

The cover amount in each section is fixed and can not be set according to an individual's requirements

How long does the cover last?

Cover is valid for 6 months.

For First Time Buyers, will it cover purchase of a flat

Yes, the cover offered is suitable for a new build property that you will be buying

For First Time Buyers, will it cover a new build

Yes, the cover offered is suitable for house or a flat purchase

For Landlords, will it cover buy to let and Flats

Yes, the cover offered is suitable for the purchase of a buy to let property and flats.

Can I cancel my policy?

If no claims are pending, then you can cancel your home buyers insurance without charge within 14 days of the start date of your policy

Do I Need Home Buyer’s Insurance?

Home buyers protection insurance is not compulsory, as such  you need to weigh up the risks versus the cost of buying home buyers' protection. Having home buyers protection can not prevent a  sale falling through, but it can protect you against monetary loss.  A property purchase can fail for many reasons, how would you feel having to foot the associated costs?  A home buyers policy will reimburse these fees, helping you to accept the situation and move forward positively with your property search.

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