Delays in obtaining the grant particularly exacerbates problems where a probate property is awaiting sale.
Without a grant, the property cannot be sold; and with delays in October 2023 reaching up to 14 weeks – probate properties could be left empty for months, if not longer.
It’s not just probate properties that lie empty for more than short spells. Many elderly family members who need to leave their homes and move in with relatives, or into sheltered accommodation, care or residential homes, will leave behind a property that lies empty for potentially weeks or months.
An unoccupied property is a greater risk than an occupied one. And there are a lot of them: according to the government, 676,304 empty homes in England were recorded in October 2022. This was 3.6% more than the previous (248,149 were vacant for more than six months).
The potential for problems associated with empty residential properties comes in several forms, including:
- Burglary, arson and other criminal damage
- Flooding, burst pipes and consequential water damage
- Electrical faults and fire risks
- Pest problems
- Structural disrepair and damage
When the property owner dies or goes into a care home, leaving an empty property, the existing insurance company will usually be prepared to continue insurance the property for a limited period.
But the reality is that as time passes, empty properties present risks sufficient to raise the concerns of insurers. Any existing insurer must be notified that the property is empty for the longer term and most will end cover after either 30 or 60 days. This provides time for the family members and/or PRs to arrange suitable cover given the heightened risks associated with unoccupied properties.
For that reason, the benefits of bespoke unoccupied domestic property insurance cannot be underestimated. Practice Enterprise’s own unoccupied property insurance product - Watchman Insurance - deserves serious consideration. It is simple to arrange, cost-effective and geared specifically to cover the risk of residential properties which are unoccupied after the death of the owner, or the owner has gone into care.
Importantly, unlike many similar policies, Watchman’s policy covers risks including malicious damage and subsidence. The property will need to be checked every 30 days, but this is less onerous than other policies that require a check every 7 days.
Many other unoccupied residential property insurance policies also demand payment of an upfront premium, which can add to any potential cashflow problems. However, with the Watchman policy there is no such requirement – only a small initial deposit is required for cover to be in place. Cover is calculated at a fixed daily rate; and the full insurance premium is then paid on completion of the sale or (if earlier) within 12 months. Cover can be arranged the same day by telephone from a friendly and knowledgeable team.
Transparency is an important element of the Watchman policy, with no hidden charges or cancellation fees.
If you are professional executors or acting for executors, it is important to remember that arranging adequate insurance is vital. As trustees, there is a legal duty to protect and preserve estate assets and if the property – often the most valuable asset - is inadequately insured and financial loss is caused to the estate as a result, the trustees could be personally liable for such losses. In just the last couple of weeks we have seen legal action commenced by a Charity (beneficiary) against a solicitor who failed to insure a property that had been severely damaged be an escape of water- left undetected for even a short while, water damage can escalate in repair costs to tens of thousands of pounds.
Arranging adequate insurance ought to be considered a first step: those responsible for empty properties should arrange and keep a record of regular practical checks of the property – particularly in bad weather. Water, gas and electricity should be turned off; letter boxes sealed; and anything inside the property that could attract criminals should be hidden or removed from the property.
Taking these steps and arranging robust insurance cover can provide clients and estate beneficiaries a comfortable level of assurance. For more information and a quote, contact us here.