Indemnity Insurance When Selling a House: 2026 UK Guide

By Lisa Hayes · 5 August 2026

If your solicitor (or the buyer's) has asked for an indemnity policy, here is the short version: it is a one-off insurance policy that pays out if a specific legal defect in your property ever causes a financial loss. It does not fix the defect. It buys the sale a clean run to completion by covering the money at risk instead. Get it right and it can save weeks; get it wrong and you can void the cover on the day you exchange.

This guide is written for the ordinary UK homeowner who has just had "you'll need an indemnity policy for that" landed on them mid-sale, with no explanation of what it means, who pays, or whether it is even a good idea. I'll walk you through all of it, plainly.

What is an indemnity policy, actually?

An indemnity policy — you'll also hear "title indemnity insurance", "legal indemnity" or "defective title insurance" — is a specialist insurance product bought during a property sale to deal with a legal loose end that can't easily be tidied up in time.

Say a previous owner built a conservatory but never got the building regulations completion certificate. The work might be perfectly sound. The problem is the missing paperwork, and there's no quick way to conjure it up years later. Rather than hold up the whole sale while everyone frets about a hypothetical, the seller takes out a policy that says: if the council ever takes enforcement action over this, the insurer pays the bill.

The buyer gets peace of mind. The lender gets peace of mind. The sale moves. That's the entire point of the thing.

A few features make these policies unusual compared with, say, your car insurance. You pay a single premium once — there are no renewals and no annual charge. The cover is permanent and it runs with the land, meaning it automatically protects whoever owns the house next, and the one after that, without anyone paying another penny. And it's arranged in minutes, usually by your conveyancer, from a specialist insurer such as First Title, CLS/Legal & Contingency, Countrywide Legal Indemnities or Stewart Title.

Because it's insurance, it's regulated by the Financial Conduct Authority, and your solicitor arranges it under that regulatory umbrella rather than you ringing an insurer yourself.

The one rule that catches everyone out

I want to sit on this point because it's the one that costs people. The whole model depends on the risk being dormant. An indemnity insurer is betting that nobody is going to come after you over the missing certificate or the breached covenant, because in the overwhelming majority of cases nobody ever does.

The moment you ring the council to "just check", or drop a note to the freeholder to "sort it out properly", you've woken the sleeping dog. If the council then says "actually, we'd like to inspect that", the risk is no longer theoretical and no insurer will touch it. Worse, if you'd already bought a policy and then made the approach, you can invalidate cover you've paid for.

So here's the practical rule: if there's any chance an indemnity policy is the route you'll take, say nothing to anyone official until your solicitor tells you the policy is in place. Regularising the issue properly and buying insurance are two different roads. You pick one. You cannot half-walk down both.

What problems can an indemnity policy cover?

These policies come in dozens of flavours, each tailored to a specific defect. You're not buying general "property insurance" — you're buying cover for one named risk. Here are the ones that come up most in ordinary sales.

Notice a pattern. In almost every case the party actually driving the request is the buyer's mortgage lender. A cash buyer with no lender can decide for themselves whether they care. A lender can't — it needs its security clean, so it insists on cover. That distinction matters a lot, and I'll come back to it.

If your defect is one of the bigger set-pieces, we've written dedicated guides worth reading alongside this one: the detail on a missing building regulations certificate, on selling with a restrictive covenant, on selling without planning permission, and on a flying freehold. This piece is the map that ties them together.

How much does an indemnity policy cost?

Less than most people fear. For the everyday risks — a missing completion certificate, a low-risk covenant — you're usually looking at a modest one-off premium, not a recurring bill.

• £20–£300typical one-off premium for common risks
• £0renewal cost — you pay once, forever
• Same dayhow fast a policy is usually issued

The premium is worked out mainly from two things: the value of the property (because that caps the insurer's potential payout) and the severity of the risk. A missing certificate on a ten-year-old porch is cheap. A live restrictive covenant with an identifiable, nearby beneficiary who might genuinely object is dearer, and occasionally uninsurable.

Here's a rough sense of how premiums scale with risk, so you can sanity-check any quote your solicitor passes on.

• Missing building regs certificate low
• Lack of planning permission low–mid
• Restrictive covenant (dormant) mid
• Absent right of way / access mid–high
• Restrictive covenant (active beneficiary) high / may be refused

One thing not to do: don't let the small premium tempt you into buying a policy you don't actually need. Solicitors sometimes reach for an indemnity reflexively because it's the fast, cheap, tick-the-box option. Cheap or not, if the underlying issue is one you could and should fix, insurance is the wrong tool. More on that below.

Who pays — you or the buyer?

Strictly, it's negotiable. In practice, the seller usually pays, and there's a fair logic to it: the defect is in the property you're selling, often created during your ownership, and you're the one who benefits from it not derailing the sale.

That said, custom varies by the situation. Where the risk arose long before you owned the place and you genuinely didn't know about it, some sellers push back and split it, or ask the buyer to cover it. When the buyer's lender is the one demanding cover for its own protection, there's an argument the buyer's side should pay. But be realistic — a policy for a common risk often costs less than a nice dinner out. Digging in over £80 while a buyer is getting twitchy is rarely a smart trade. If the sale is otherwise good, pay it and move on.

A quick tactical note if speed is your priority. If you're selling to a genuine cash buyer or a house-buying company, the indemnity question can sometimes disappear entirely, because there's no lender forcing the issue. That can be the difference between a defect stalling your sale for weeks and it barely registering.

What an indemnity policy does NOT do

This is where sellers — and buyers — get burned, so read it twice. An indemnity policy is a financial safety net, not a legal cure. It changes who bears the cost if things go wrong. It changes nothing about the underlying legal position.

The building-safety point deserves a blunt word. A missing building regulations certificate is a paperwork risk, and it's usually fine. But building control sign-off also exists to confirm work is safe. If a past owner rewired the house or removed a chunk of a load-bearing wall with no sign-off, an indemnity policy will happily cover the enforcement risk while telling you precisely nothing about whether the wall is going to hold. Insure the paperwork by all means. Where the work is significant, get a surveyor or structural engineer to look at the substance too. The policy and the safety check are answering different questions.

Will a mortgage lender accept an indemnity policy?

Usually, yes — and this is the whole reason the product exists at scale. Most mainstream lenders will accept a properly worded indemnity policy for the common defects, and their requirements are set out in the UK Finance Lenders' Handbook, which your conveyancer follows to the letter.

There are conditions. The policy normally has to name the lender as an insured party, the cover amount usually has to be at least the property's value (some lenders want it index-linked so it keeps pace with inflation), and the wording has to match the specific defect. A generic policy stapled to the wrong problem is worse than none, because it creates false comfort.

Where lenders get sticky is with anything that smells of physical risk — cladding, structural issues, serious safety concerns. Those aren't paperwork problems and an indemnity policy won't paper over them. If your defect is in that territory, insurance is not your answer; proper investigation is. Our guide on selling an unregistered property covers a related lender headache worth understanding.

When an indemnity policy is the right call — and when it's a lazy fix

Here's my honest, opinionated take after seeing this play out on hundreds of sales.

An indemnity policy is the right call when the defect is genuinely dormant, the cost or time to regularise it properly is disproportionate, and no active party is likely to enforce. A missing completion certificate for a conservatory built in 2011? Insure it, exchange, get on with your life. A dusty covenant from 1953 whose beneficiary is long untraceable? Same. These are exactly the situations the product was built for, and reaching for insurance is the sensible, proportionate move.

It's a lazy fix when the problem is fresh, fixable and cheap to put right — and a policy is being used to dodge the honest work. If you took down a wall last year with no building regs, the clean answer is often a regularisation certificate from building control, where the council inspects and signs off after the event. Yes, it's slower. Yes, there's a fee. But you end up with a property that's genuinely compliant, not one carrying a defect insured over for the next buyer to inherit and re-insure.

And think about the buyer's shoes, because a good buyer thinks about yours. A savvy purchaser knows an indemnity policy is a flag that says "there's an unresolved issue here". Pile up three or four of them on one title and you can spook a buyer, or invite a chip on the price at the worst moment. One clean fix can be worth more than three cheap policies. Be honest about which situation you're in — our guide on what you must legally disclose when selling is essential reading here, because insurance never replaces disclosure.

The enforcement clock: why timing changes the risk

Two legal changes in the last few years have quietly shifted how much these paperwork risks actually matter, and any decent guide should tell you about them rather than hand-wave.

For building regulations, the enforcement window used to be short — a local authority generally had to act within twelve months of the work being completed. That changed. Under the Building Safety Act 2022, from 1 October 2023 the period for a local authority to prosecute a building regulations contravention was extended to ten years. So work signed off decades ago sits far outside the danger zone, but more recent unauthorised work now carries a much longer tail of enforcement risk than it once did. That's part of why lenders have grown fussier about missing certificates.

For planning permission, a separate change applies. Since 25 April 2024, the enforcement period for breaches of planning control in England became ten years across the board, under the Levelling-up and Regeneration Act 2023. There's a transitional wrinkle: where the works were substantially completed, or a change to a single dwelling happened, before 25 April 2024, the old four-year rule can still apply. It's fiddly, and it's exactly the sort of thing your conveyancer should pin down before deciding whether insurance or regularisation is the better route.

The practical upshot: the older and more clearly "time-expired" a breach is, the safer it is and the cheaper it is to insure. The fresher it is, the harder you should think about fixing it properly instead.

How to actually get an indemnity policy

You don't do this yourself. It runs through your conveyancer, and the process is mercifully quick.

1. Your solicitor identifies the defect — usually flagged in the searches, the title, or the buyer's enquiries.
2. They confirm insurance is appropriate and, crucially, that nobody has approached the council, freeholder or beneficiary about it.
3. They obtain a quote from a specialist legal indemnity insurer, matched precisely to the defect and the property value.
4. The premium is agreed between you and the buyer — who pays gets settled here.
5. The policy is issued, often the same day, and a copy goes to the buyer's solicitor and lender before exchange.
6. The document is kept with the deeds, ready to pass to the next owner — because the cover follows the house, not you.

If you don't yet have a conveyancer lined up, our guide on whether you need a solicitor to sell and the walkthrough of the conveyancing process will get you oriented.

Selling to a cash buyer: do you even need one?

Often, no. And this is the bit the high-street conveyancing world tends to skate over.

An indemnity policy is, nine times out of ten, demanded by a lender protecting its security. Strip the lender out of the transaction and the requirement frequently vanishes. A genuine cash buyer, or an established house-buying company, can simply take a commercial view: they can read the defect, weigh it, and decide it doesn't bother them — often because they buy with their eyes open and price accordingly.

That's precisely why sellers with awkward legal defects — an unresolved covenant, a bit of unpermitted work, a scrap of missing title — sometimes find a cash route far less painful than a mortgaged sale that snags on every enquiry. If your property is proving hard to shift through the usual channels because of a title wrinkle, it's worth understanding your options for a faster sale, or for selling a home that's been branded "unsellable". A defect that terrifies a mortgage underwriter can be a shrug to a cash buyer.

None of that means a cash sale is automatically the answer — you'll usually accept a lower figure for the speed and certainty. But if a defect is the thing standing between you and completion, it's a lever worth knowing about.

Common mistakes to avoid

A short, blunt list, because these are the ones I see again and again.

• Tipping off the authority. Said it already, saying it again. One "quick call" can void everything. Don't.
• Insuring a problem you should fix. Fresh, cheap-to-cure defects deserve a proper fix, not a plaster.
• Assuming the policy makes work safe. It covers money, not masonry. Get significant work checked.
• Buying the wrong policy. The wording must match the exact defect, or the cover is hollow.
• Letting it replace disclosure. You still have to answer the buyer's enquiries honestly. Insurance is not a way to hide a known problem.
• Panicking. Nine times out of ten this is a £50 formality, not a crisis. Treat it like the routine speed-bump it usually is.

Frequently asked questions

Does an indemnity policy expire?

No. A standard title indemnity policy is a one-off, single-premium policy with no expiry and no renewal. The cover runs with the land and passes to future owners automatically.

Can I take out a policy myself without a solicitor?

In practice, no. These policies are arranged through your conveyancer, who matches the wording to the defect and to the lender's requirements. That's a feature, not a hoop — a mismatched policy is worse than none.

Will the buyer's lender definitely accept it?

Usually, for common defects, provided the policy names the lender, covers at least the property's value, and matches the risk. Lenders follow the UK Finance Lenders' Handbook. Physical-risk issues like cladding or structural defects are a different matter and generally can't be indemnified away.

Facing a defect that's holding up your sale? The fastest way to find out whether it's a genuine problem or a routine formality is to get a realistic read on your position — and your options. Compare offers and see what your home is really worth with a free, no-obligation valuation and quick-sale comparison. No pressure, no tipping off anyone — just a clear picture of where you stand.