When planning your build project, it can be difficult to work out what policy will best protect your investment after completion. There are two policies that can cover you from completion; the first is a structural warranty, and the second is a Professional Consultants Certificate (PCC).
In this article, I explore both options, what they provide, and why a structural warranty may be better suited to your self build, conversion or extension project.
A structural warranty is a specialist policy which protects your property from structural defects for 10 years after completion. The policy covers defective design, workmanship and materials for all new structural works that you have undertaken on your home.
It’s worth bearing in mind that structural warranties are usually a mortgage requirement for all new build projects. So, if you either have a mortgage, expect to remortgage or plan to sell the property within 10 years after the build is complete, the lender will only usually approve the loan provided that you have a structural warranty in place.
A Professional Consultants Certificate (PCC) – also known as an architect’s certificate – is a policy which only offers limited cover for your project for a period of six years from the point of completion. This is significantly shorter than the standard 10 years you would get from a structural warranty. A PCC will only usually cover defective design and you will need to prove the designer negligent for the defect before you are able to claim.
By contrast, under a structural warranty, negligence does not have to be proven for you to submit a claim – so you simply go through the provider’s normal claims process. Proving negligence can add time to the process and incur additional costs before a claim can be submitted, which could all be avoided with a structural warranty.
Why should you take out a structural warranty rather than only a PCC? The key reason to take out a structural warranty over a PCC is the additional cover it provides. No one builds a property with the view of making a claim on the warranty once it is constructed, but unfortunately, this can and does happen. Since a PCC only covers defective design, it is not as comprehensive as a structural warranty, which also covers issues with workmanship and materials.
Structural warranties tend to be more widely accepted by lenders, too. This will make it easier when you come to sell or if you need to raise funds against the property. You will have access to more lenders and should be able to secure a better mortgage rate as a result.
A structural warranty provider should be judged by the insurer they use and who underwrites the policy. We recommend that you only consider companies who use an A-rated insurer, which refers to the insurer’s financial stability and ability to make claims. As the structural warranty is a 10-year policy, you need to be confident that the provider will be there when you need them, including towards the end of the time period. The easiest way to guarantee this is if they are A-rated.
|Jake Fitness is team leader at Self-Build Zone, which offers a comprehensive range of specialist self build, renovation, extension and site insurance cover, as well as self build warranties. Call 0345 230 9874 or visit Self-Build Zone for more.|