Towergate is proud to be part of Ardonagh Advisory – the broking and advisory platform of The Ardonagh Group.

From 22 March 2022 our legal entity name has therefore changed to ‘Advisory Insurance Brokers Limited’.

Latent Defects Insurance

01903 875 423

Latent defects insurance is a cover taken out for new build commercial and residential premises. It is designed to cover defects which manifest within the structure after practical completion.

What is Latent Defects Insurance?

Latent defects insurance (also commonly referred to as a structural warranty) is a form of insurance that primarily provides indemnity against the costs incurred in rectifying defects that manifest within the structure after practical completion.

It is a requirement of UK Finance (formally known as the Council of Mortgage Lenders) for all new build residential open market sales but can also be purchased for commercial and mixed-use developments. 

Policies can also be extended to include:

  • Mechanical and Engineering Defects
  • Loss of Deposit/Insolvency of Developer
  • Building Control
  • Contaminated Land
  • Loss or Rent

Why do I need latent defects insurance?

Also known as New Home Warranties, Latent Defects Insurance is required by the Council of Mortgage Lenders for all new build residential open market sales. 

There are often faults and defects caused by failures in design, workmanship or materials throughout the construction process and may not be detected for many years after the completion date. Our specialists are on hand to assist with the complexities in arrange the right cover for you.

These defects can be extremely expensive to rectify and the Latent Defects Insurance offers protection to homeowners.

What does latent defects insurance cover?

We can accommodate the following types of risks:

  • Commercial and Residential buildings
  • New Builds and renovations
  • Conversions, extensions and Refurbishments
  • Grade 1, 2 Listed Buildings and Hotels
  • Permitted Developments
  • Private Rental Sector and social Housing
  • Student Accommodation
  • Retrospective

Key features of our latent defects insurance

Cover will be provided for 10 years from the issue of the building control completion certificate (12 year polices are available if requested).

A standard policy will cover the structure and weatherproofing but this can be extended to include non-structural elements such as component failure, mechanical and electrical services and business interruption.

We are a one stop shop for all your Latent Defect Insurance and site requirements. Key features include:

  • Simplified process to accommodate your project requirements: simply complete an electronic proposal form which we will provide you with, and supply us with a copy of the plans and elevations. We will then review the information and approach the relevant insurers that can accommodate your project requirements.
  • Accommodating payment terms: we can offer flexible payment options to suit your needs.
  • Market knowledge: our specialists have the most up to date information on any market changes as they receive updates first hand from each provider.
  • A personal approach: a dedicated specialist will be on hand to review each project from start to finish. We help to manage the technical relationship between your site manager and the provider’s technical team. In addition, we will be the initial point of contact in the event of a claim throughout the duration of the policy

Other business covers in one policy

We can offer you a simplified package, as we can collate a Towergate portfolio of insurance.

A typical contractors’ insurance package will consist of:

  • Insurance Backed Guarantee - Offers valuable protection for tradespeople in the unlikely event of your company ceasing to trade. Various areas can be covered under and IBG and cover is often required alongside LDI in relation to workmanship and materials for example, Flat Roofing
  • Contractors All Risks (CAR) – insurance protects against physical damage to works and site materials that the company was contracted to undertake. This is the most common insurance policy for contractors/developers
  • Public Liability – injury to 3rd parties (nonemployees) or their property
  • Employers Liability – Coverage to protect against liabilities to employees for injury or illness. This is a mandatory cover if directly employing staff or labour only sub-contractors
  • Professional Indemnity – Protects against loss or damages from professional negligence or negligent advice (design is a common one)
  • Right for Light
  • Surety Bonds & Guarantees

Why use Towergate to arrange your latent defects insurance?

The Latent Defects Insurance market has seen many changes in the last 12-24 months with some of the leading providers withdrawing from the market and various insurers increasing rates or reducing coverage.

These changes present the ideal opportunity to consider using Towergate Insurance Brokers to negotiate your next warranty and leverage our key market relationships to provide you with the best coverage at the right price.

We also have considerable experience across the construction sector and can assist in the following areas which may also be of consideration in connection with your development:

  • Contract Works cover
  • Employer’s and Public Liability cover
  • Professional Indemnity cover
  • Property cover (both existing structures or the completed project)
  • Insurance Backed Guarantees
  • Property Valuations
  • Legal Indemnities e.g. Right to Light
  • Bonds (Performance/Advanced Payment/Road and Sewer etc)

Get a latent defects insurance quote

Request a quote or call us on 01903 875 423.

Read other business insurance articles

Download our latent defects insurance brochure