Legal indemnities

For a variety of reasons, the title to a property may be considered defective, or there may be land restrictions regarding the type of property which may be built, or its permitted use.

In the majority of cases, there is an Insurance answer to these problems for which a policy can be arranged to cover capital loss and legal expenses incurred in the event of a claim arising.

Insurers can provide open-ended cover for a limit of indemnity that represents the value of the property being sold including any anticipated development. In addition it is also possible to include an escalator clause whereby the limit of indemnity can be automatically increased by a selected percentage (usually 5-10%) each year for the first five or ten years that the policy is in force.

As each case is different, Insurers will of course require specific information to enable them to consider the risk and we have therefore compiled a guide detailing the information required for the more common type of problems that you may encounter.

Defective Title Indemnity

Information required:

  • A letter describing the defect with supporting documentation, plans and if possible photographs.
  • The history of use of the property and details of the proposed use
  • The limit of indemnity required and what this represents
  • The full value of the property including any planned development
  • Where a change of use or development is proposed, a copy of the planning consent and copies of any letters of objection received by the Planning dept.

Restrictive Covenant Indemnity

Information required:

  • A letter describing the problem
  • Copies of the deeds (with plans) imposing the restrictive covenants
  • The history of use of the property and details of the proposed use
  • Where a new development is intended, a copy of the planning consent and any letters of objection received by the Planning Dept.
  • Details of the use of surrounding properties
  • The limit of indemnity required and what this represents and, where appropriate, the anticipated full value following development

“Year and One Day Risks”

Information required:

  • A copy of the Will
  • Date of death of the deceased
  • Date of registration of the Will in the Royal Court
  • A copy of the family tree of the deceased. (This should at least be to the extent of the degree of relationship of the devisees to the deceased).
  • Who would inherit the property if there had been no Will?
  • Did the deceased buy or inherit the property? When was this?
  • Did the deceased live alone at the property? If not, who else lived there also?
  • Has the property been advertised for sale? If so, for how long?
  • Are all the family aware of the death of the deceased, aware of the contents of the Will and aware of the sale of the property? Have there been any objections and if so, please provide full details

It is also possible to cover the risk of a subsequent Will being discovered. If required, please telephone for details.

Trustee Risks Insurance

We can arrange policies for specific problems encountered by trustees and personal representatives of estates such as missing beneficiaries or lost wills.

Missing Beneficiary Indemnity

This cover protects the personal representatives and beneficiaries where searches to trace a missing person or a whole line of the family have proved unsuccessful.

Trustees Indemnity

This is designed to cover a specific or potential breach of trust which is unavoidable. Examples of such situations include:

  • Further beneficiaries being born after distribution of the trust
  • Missing will
  • Directive to distribute funds to a charity which no longer exists
  • Reversion of school sites

Absence of Grant of Representation

This is an indemnity which enables a bank to release a small estate without formal Grant of Probate or Administration.

Our policies are usually open ended and a single premium only is payable. We will be happy to supply a specimen policy wording, if required.