Protecting Your Investment: The Essential Role of a Structural Warranty
A home’s structural integrity is key to a safe and happy life. Most people take a warm, secure home for granted – until something goes wrong. That’s where a structural warranty becomes essential.
Everyone – from large commercial property developers and individuals building their family homes – wants to minimise costs. It’s easy to assume that, because a recently constructed building seems sound, there’s minimal risk involved in terms of its longer-term integrity. However, latent defects can arise in the years after completion.
What is a Structural Warranty?
Structural warranty insurance covers unexpected structural defects in buildings that aren’t evident at the time of construction. This type of cover can be taken out by residential and commercial developers and by house buyers themselves.
Structural warranties typically last for ten years from the date of completion, providing peace of mind to both developers and homeowners, ensuring that defects with the structural integrity of a building will be dealt with and made good as quickly as possible.
What do Structural Warranties cover?
Typically a Structural Warranty will cover:
- Design flaws – Covers issues like poor load distribution, inadequate structural support, or failure to consider environmental factors.
An effective structural warranty will protect against the costs of repairs and rebuilds associated with flaws in the original design of a building. These issues can lead to problems years after a project is completed. Structural issues that come about as a result of design flaws can be very serious to the structural integrity of the building.
- Workmanship issues – Protects against defects caused by unqualified builders or human error during construction.
Poor standards of workmanship, during the original construction, can result in weak structural integrity that might not be visible right away. Structural warranties protect developers against rogue or unqualified tradespeople and cover against human error that leads to compromised structural quality.
- Material failures – Covers damage due to substandard or poor-quality materials.
When flawed materials are used in the construction of a building, which later results in structural issues, structural warranties will cover the cost of repairing the damage.
Structural Warranty coverage can vary, so it’s important to check with your provider to see what’s included in your policy.
How do Structural Warranties work?
Developers, housebuilders and house buyers can all take out structural warranties. When a policyholder identifies a defect, they report it to the insurance provider, who then investigates the claim. If approved, the developer and policyholder are notified, and the cost of repairs is covered. The first two years after a construction project is completed is known as the ‘developer liability period’. During this time, the developer is liable to rectify structural issues.
Why do people take out Structural Warranties?
- Peace of Mind
For those buying a new-build home, or even building their own house, the investment is significant. However careful and experienced developers are, unforeseen structural problems can sometimes arise within the first ten years. Structural warranties offer peace of mind during this period.
- Mortgage Approval
As well as covering the risks involved, a fully insured development will also be more attractive to buyers. In fact, most mortgage lenders follow the UK Finance Mortgage Lenders’ Handbook. Most lenders considering applications for new-build properties will want to ensure the building has a high-quality structural warranty in place before they lend against the property.
- Financial Security
For most homeowners, the unexpected cost of repairing a major structural issue would be crippling. A structural warranty removes the threat of unaffordable repairs, which provides financial security and allows families to plan their future finances. For developers, the cost of repairing unforeseen structural issues across a development could create significant cash flow issues, potentially leading to insolvency.
Beyond offering financial security, a structural warranty provides reassurance by covering costly repairs and maintaining the integrity of a property. For homeowners, it means a safe, warm, and secure place to live without unexpected financial burdens. For developers, it enhances their credibility and marketability while mitigating potential risks. Whether you’re buying, building, or developing property, a structural warranty is a smart investment that protects both your future and your finances.
Get a Structural Warranty quote today!