Due to a number of last-minute issues, the FSCS (Financial Services Compensation Scheme) has been unable to secure replacement Latent Defect / Residential Warranty cover via BCR Legal Group following the collapse of Alpha Insurance and are now issuing refunds.
This will affect over 20,000 customers of Alpha who no longer have cover; many of whom may be unaware. Not only does this put them in breach of their mortgage conditions, but homeowners may also be unable to sell their property in the future and they could be liable for substantial expense if structural defects or land contamination become evident.
The NHBC are unable to assist as they do not provide replacement (typically known as Retrospective) Latent Defect cover. Peacock Insurance, however, has negotiated terms with an ‘A’ Rated financially stable Insurance Company based in the UK in order to assist Alpha customers.
Peacock Insurance urges those concerned to take immediate action and contact them to discuss your circumstances. Please contact their specialist Latent Defect team on 02476 437626.
What is a Latent Defect / Residential Warranty policy?
This type of insurance covers defects made by contractors during construction that cause damage to the structure for 10 or 12 years after the building works completed. This type of insurance is usually taken out by the developer on behalf of the homeowner. It covers:
- Workmanship faults
- Faults in the design
- Faulty materials
- Faulty installation
- Faulty construction
- Contaminated land clean up costs
Do I need Latent Defect Insurance?
This type of cover is a mandatory requirement for all Major UK Lenders. This means that if no cover in force it is a breach of Mortgage Terms and Conditions. Homeowners will be unable to sell their home within the first 10 years and they could incur substantial costs should structural defects or land contamination occur.