The Council of Mortgage Lenders (CML) have amended their handbook to liberate conveyancers from specific lending insurance requirements.
The new guidance in regard to building insurance states conveyancers must “make reasonable enquiries to satisfy themselves that buildings insurance has been arranged for the property from no later than completion” which could mean simply asking the buyer for confirmation that cover is in place.
Conveyancers must also “remind the borrower to have in place no later than completion, buildings insurance which complies with the requirements of the mortgage contract, and maintain such insurance throughout the mortgage term.”
After the CML Handbook amendment comes into effect on 30th November, any insurance no matter how inadequate is assumed to suffice. The conveyancer is under no obligation to police either point, and will mean lenders will only be able to take action against buyers.