In its simplest terms, structural warranty is insurance for the structure of your new home, normally for a period of 10 years after completion, depending on the provider and policy
Although structural warranty is purchased by the builder before construction starts, it actually protects the homeowner from structural defects that may occur during the first ten years after it has been completed.
What does structural warranty cover?
The cover provided by a structural warranty varies significantly depending on the provider but can include:
- Defects insurance – the more prominent providers of structural warranties will include a defects period for the first two years of cover. This provides protection against non-compliance with the warranty provider’s technical manual and may include non-structural issues.
- Structural insurance – this consists of the principal part of the warranty and covers against structural issues after the defects period expires.
- Contaminated land – protects against the cost of removing contamination from the housing plot.
- Building Control cover – if features of the house were not built in compliance with Building Regulations and can result in a danger to the health of residents this can cover the costs to rectify any issues.
- Deposit protection – should the developer become insolvent during the build this protects the homeowner’s deposit.
Is structural warranty compulsory?
No, it’s not compulsory. However, most lenders will require one, and you may have problems when it comes to selling a house that is less than ten years old if you don’t have a warranty.
A structural warranty is often a requirement for a self-build mortgage. So while it might not be a legal requirement, you will encounter several obstacles if you choose not to take out a policy.
Some self-builders may opt for an architect’s certificate. This is a signed statement which confirms that the build has been supervised and constructed in line with building practices. It may be cheaper than a warranty however, it usually only covers six years and is not an underwritten insurance policy.
In reality, there are no real alternatives to a structural warranty if you have a self-build mortgage or you are looking to sell within 10 years — it is likely a cost you will have to accept, but one that provides a great deal of protection for you and your new home.
So, how do I select the right warranty for me?
With the market expanding there are now several warranty providers to choose from.
We’ve compiled a short list of some of the best (in no particular order):
- Premier Guarantee – with over 300 employees that work across the country, Premier Guarantee support their clients with construction projects and structural warranty solutions for all types of residential and commercial builds.
- LABC Warranty – since 2007 LABC Warranty has worked in partnership with Local Authority Building Control (LABC) to provide structural warranties. They provide building control and warranties throughout England and Wales using the combined technical expertise of over 3,500 surveyors.
- Protek – offering structural warranty products designed for builders and developers of new residential and regeneration homes.
- Build-zone – experienced in underwriting warranties for all types of developments, from single unit new-builds to large residential or commercial developments.
- BLP insurance – provides housing warranty insurance and commercial development latent defects insurance underwritten by Allianz Global Corporate & Specialty SE.
- Advantage – Advantage structural defects insurance is a national company with offices in London, Warrington, Birmingham, and Dublin.
Structural warranty schemes tend to follow a similar process:
- The applicant submits plans, specification, completed application form and an application payment to the provider.
- The provider will calculate a quote for the policy. The fee is calculated based on the individual property but is mainly linked to the floor area.
- An inspector will visit the applicant for an appraisal meeting.
- The applicant signs and returns an acceptance letter.
- The warranty provider will supply a technical manual, other policy documents and a site folder to log progress and inspection results.
- The build begins and site inspections are requested at designated stages to check compliance with the warranty standards. It is worth noting that often the technical standards required by the warranty provider are higher than those required by building control.
- When the build is complete and all stage certificates and a completion certificate have been issued the 10-year structural defects cover begins.
So, although you may think that if your project meets all the building regulations nothing can go wrong, unfortunately that is not always the case. Inspectors, architects and builders can make mistakes, there can be faults with the building materials you use in the structure of a new building or there could be issues with the land the building is constructed on. A structural warranty covers you against all these potential risks!