What is the indemnity policy for the lack of freeholder consent?
An indemnity policy for lack of freeholder consent, also known as a leasehold indemnity policy, is a type of insurance policy that provides financial protection to the leaseholder in situations where the freeholder's consent for certain actions or changes to the property cannot be obtained. This policy is commonly used in leasehold transactions or property-related matters where the absence of freeholder consent could potentially create legal or financial risks.
Here are some key points about indemnity policies for lack of freeholder consent:
- Purpose: The policy aims to protect the leaseholder from potential losses, damages, or legal expenses that may arise due to the absence of freeholder consent. It provides financial compensation or covers legal costs incurred in defending against any claims that may arise from the lack of consent.
- Covered actions: The policy typically covers specific actions or changes to the property that require the freeholder's consent, such as alterations or extensions to the property, subletting, change of use, or assignment of the lease.
- Terms and conditions: The policy will outline the specific circumstances and limitations of coverage, including the scope of actions covered, policy exclusions, and any conditions or obligations that the leaseholder must adhere to.
- Premium and duration: The cost of the indemnity policy is typically a one-time premium paid by the leaseholder, which is based on the perceived risk associated with the lack of freeholder consent. The policy is usually valid for a specific duration, providing coverage during that period.
- Obtaining the policy: Leasehold indemnity policies are typically obtained through a solicitor or insurance provider specializing in property-related insurance. The policy is often purchased during the conveyancing process or when seeking consent for specific actions.
It's important to note that each indemnity policy is unique, and the specific terms, coverage, and exclusions can vary. It is recommended to consult with a qualified solicitor or insurance professional to assess your specific situation, determine the appropriate level of coverage required, and review the policy terms thoroughly before making a purchase