J3 Advisory Structural Warranty
New Build Warranty
There has been a significant increase in the number of new build warranty providers in the market, and as a result property professionals are now being inundated with various proposals from providers offering their services.
With experience in advising and arranging new build warranties across the residential spectrum, J3 guides their clients through the process with concise, accurate and timely advice on all options available to them.
Since our launch in 2021, we have placed new build warranties on a number of projects – the more notable cases include a £17m residential scheme in East London & structural warranties on £26m worth of developments across Skillcrown & Epicho Homes.
What factors impact the cost of a new build warranty?
There are five main elements that affect the cost of your warranty:
Professional teams experience
Demonstration that the developer, contractor and sub-contractors have carried out similar sized projects and has a clean claims history.
The stage of the works
Developers will always find it most cost effective by arranging the warranty before the works commence.
Financial standing of the Developer
he stronger a developers financial footprint the more favourable terms an underwriter will offer.
Development specifics
The size, cost and location of your development
The Developer’s standing
A developers rating with other insurance providers (if available)
What are the key considerations when selecting a new build warranty provider?
Some of the key considerations that developers should be aware of are:
Limit of indemnity
Developers should always confirm in writing that the reinstatement cost and the limit of indemnity on the policy mirror one another.
Access to the lending market
Insurers who don’t have A-rated carriers often have more restrictive lender acceptance lists that can become detrimental to sales.
A-rated capacity
Check that the insurers’ underwriter has a financial rating from one of the UK’s ratings agencies. While nobody can completely guarantee the solvency of any entity, these ratings evaluate and assess a company’s creditworthiness and offer comfort to their network that they are a reputable business on sound financial footing.
Demonstrable experience
Property professionals and developers should understand the insurers’ appetite and experience of similar sized schemes
How long will it take to get a new build warranty in place?
Once we have full enquiry details, alongside supporting documents, it is fair to assume a four-week time period from submission to boots on the ground for an inspection. On larger schemes (in excess of £25m), we always advise clients to allow a 6 week lead time.
How much does a new build warranty cost?
To find out how much your new build warranty is likely to cost for your next scheme, use our online building warranty cost calculator.
New Build Warranties from J3 Advisory
At J3, we don’t always go to every corner of the market – our experience, relationship, and networks ensure we have access to the right ones, ultimately saving our clients time and money.
When your next project does come into focus, we would be happy to talk through the scheme and offer our pragmatic and advice without confliction on the new build warranty insurance policy for you.
For developments containing a combination of homes for sale, private rental, social housing and commercial, it’s vital to seek trusted and impartial warranty advice. At J3 Advisory, we cover this under our Mixed Use Scheme.
Projects with a contract value above £25m, professionals will benefit from our Major Projects Scheme.
Why use J3 Advisory?
Here are just a few of the reasons why you should consider J3 Advisory for arranging new build warranties and insurance on your next project:
We only work with ‘A’ rated, UK based insurers for structural warranties and latent defects insurance. Given that the period of cover for a structural warranty is ten or twelve years, it’s essential to ensure that the insurer’s underwriter holds a financial rating from one of the UK’s ratings agencies. While no one can completely guarantee the solvency of any entity, these ratings provide a robust evaluation of a company’s creditworthiness and give assurance that the insurer is reputable and likely to remain operational throughout the duration of the policy should it need to be called upon.
The structural warranty and latent defects insurance cover we arrange is accepted by leading banks and building societies, which means buyers can obtain a mortgage to purchase a home from you.
A Tailored Service for Developers
At J3 Advisory, we understand the market and recognise that no two developments are the same. That’s why we go beyond simply arranging structural warranties and latent defects insurance. We carefully identify the right insurers for your specific needs, handle all aspects of policy arrangement, and manage queries on your behalf to ensure a smooth process. Our dedicated after-sales service means we continue to support you after the policy is in place, proactively addressing any issues and ensuring everything stays on track, so you can focus on delivering your development with confidence.
New build warranty FAQs
What is a new build warranty?
A new build warranty, also known as a structural warranty is an insurance policy that covers certain defects and issues in newly constructed properties. It typically covers structural defects and may also include other components like roofs and windows. For a comprehensive overview, visit our structural warranties page
Who provides new build warranties?
Every warranty provider offering new build warranties is required to commit to a consumer code. This code safeguards consumers throughout the sales process and provides a mechanism for resolving disputes in case of any complications. Some providers operate within Consumer Code for Home Builders. However, since October 2022, prominent developers have opted to enroll their projects in the New Homes Quality Code, an alternative program.
What does a new build warranty cover?
New build warranties generally cover structural defects that occur within a specific time frame after construction (Generally 10 or 12 years). This may include issues like foundation problems, load-bearing walls, and other major structural elements.
Can the warranty be transferred to a new owner if the property is sold?
New build warranties are transferable to subsequent owners, which can add value to the property when it is sold.
What is excluded from a new build warranty?
Exclusions can vary, but common items not covered by new build warranties may include general wear and tear, cosmetic issues, and issues caused by homeowner negligence.
Is there a deductible for warranty claims?
Some warranties may have a deductible, which is the amount the homeowner is responsible for before the warranty provider covers the rest of the costs.
What happens if the developer or contractor goes out of business?
Your new-build warranty will remain unaffected even if your developer or contractor goes bust. However, in the event that the insurer responsible for your warranty faces insolvency, another insurer may need to step in. It’s important to note that you may be responsible for the cost of obtaining the new coverage.
Click here to read our checklist when selecting the new build warranty provider.
Do new build warranties impact a mortgage application?
A new build warranty is essential to the mortgage process, and lenders will require a policy is in place for properties that are up to 10 years old. For older properties, lenders will usually ask to see evidence of a warranty even if it’s expired.