Early this month saw the collapse of Alpha Insurance who supplied 10 year structural warranty insurance. This means that anyone purchasing a policy through Alpha is effectively left without cover and are probably still unaware. As yet no plans have been released on how customers will be affected going forward.
A warranty is designed to cover you against structural defects that occur within 10 years of completion so the importance of purchasing a policy with A-Rated insurer cannot be underestimated.
Put simply, an unrated insurer is one that does not carry an insurer financial strength rating given by international rating agencies, such as Standard & Poor’s 500 index , A.M. Best or Fitch Ratings. While it isn’t a perfect system the insurers rating provides an assessment of the financial strength of an insurance organisation and its ability to pay claims to its policyholders.
If you have an Alpha insured warranty & you sell your house within the 10 year period, the warranty could be an issue as the rights under the Financial Services Compensation Scheme will not apply to the new owner. Anyone purchasing the property within the first 10 years that also require a mortgage will find themselves unable to do so without a structural warranty in place at the insistence of the finance provider.
This effectively means you will have to buy a retrospective warranty which will be more than your original policy due to it requiring an expensive completed housing survey.
If you are affected by the collapse of Alpha and require advice or a quotation please do not hesitate to contact Andy or Beth on 01302 346831 or via email firstname.lastname@example.org