There have been significant changes to the warranty market in recent years- While some structural warranty providers withdrew from the market, narrowing the options available to developers, others found themselves temporarily halting the issuance of new policies while they worked to secure additional capacity facilities.

At J3 Advisory, we will only work with structural warranty providers that have A-rated capacity. While there is no requirement for an insurer to be rated, it provides credibility to their operations. During our discussions with developer clients, we often emphasize the significance of inquiring about their structural warranty providers to understand the critical role of knowing who stands behind your warranty.

Some of the questions to ask of your structural warranty provider:

  1. Who is your insurer?
  2. What is their rating?
  3. Limits of indemnity
  4. Access to the lending market

For more information on the above, please read our blog on 10 year structural warranties.

Understanding ‘A’ Rated Insurers

In the event of a claim, the insurer bears the responsibility for payment. An ‘A’ Rated insurance company undergoes thorough evaluation by agencies such as Moody’s, Fitch, Standard & Poor’s (S&P) & A.M. Best. These assessments gauge the insurer’s long-term financial strength and its capacity to fulfill valid claims. Conversely, lower-rated insurers (e.g., ‘B’ or ‘C’) exhibit a diminished ability to settle claims, while unrated insurers need more independent verification of their financial stability, potentially leaving claims unsettled.

The Importance of an ‘A’ Rated Insurer for Structural Warranties

When constructing a new property, securing a structural warranty is paramount for seamless sales and buyer protection. However, with a plethora of structural warranty providers available, selecting the right provider can take time and effort. The solution lies in opting for ‘A’ Rated structural warranty providers.

Structural defects warranties span 10 to 12 years, a duration far surpassing standard annual insurance policies. Consequently, the selection of an insurer must be approached with utmost care. Opting for an unrated insurer, as demonstrated by the bankruptcy of Alpha Insurance A/S in 2018, can lead to substantial consequences. This incident left thousands of homeowners without cover and prompted established warranty provider CRL to cease operations. Choosing an unrated structural warranty provider may initially seem cost-effective, but it carries the risk of substantial long-term expenses.

The Pitfalls of Not Using an ‘A’ Rated Structural Warranty Provider

Selecting an insurer that later goes out of business can result in higher expenses in the long run. Not only could the initial premium be forfeited, but obtaining a new warranty becomes a necess. This expenditure, coupled with potential delays, could erode profit margins significantly. Additionally, retrospective warranty procurement is more challenging, with ‘A’ Rated insurers conducting technical audits throughout the construction process to ensure high standards and identify defects early on. To get an indicative cost for your structural warranty, click here.


As the demand for new build properties continues to rise, the need for dependable structural warranties grows in tandem- however, it is crucial to conduct comprehensive research into the financial rating of the insurer supporting your chosen structural warranty provider.  ‘A’ Rated providers offer the financial backing necessary for a 10 or 12-year insurance term, ensuring peace of mind and support throughout your policy term.