Every property purchase is different, and while many transactions complete without issue, some can fall through unexpectedly. When this happens, buyers may be left out of pocket after paying for surveys, conveyancing, mortgage valuations and other associated costs. Home Buyers Protection Insurance can help provide financial protection in certain circumstances, but obtaining cover at the right time and providing accurate information is essential. This case study compares two buyers with similar goals who took different approaches, highlighting why understanding the policy requirements from the outset can make all the difference.
Scenario 1 – The Right Approach
The Situation
David Turner, a first-time buyer from Kent, had previously lost money on a property purchase after the seller withdrew shortly before exchange. When purchasing another property, he wanted protection against losing survey, conveyancing and mortgage-related costs if something unexpected happened.
The Challenge
David was concerned about spending money on legal work, searches and surveys before knowing whether the purchase would complete.
Client Feedback
"The process was straightforward and gave me confidence that if something outside my control happened, I had some protection in place. Having experienced a failed purchase previously, it was reassuring to know I had protection against losing some of the costs involved."
David Turner
The Solution
Before instructing his solicitor and before any surveys or searches had been completed, David arranged Home Buyers Protection Insurance.
He carefully:
✔ Provided accurate information about the property transaction.
✔ Confirmed the property was a residential property in England.
✔ Arranged cover before surveys and searches were completed.
✔ Read the policy documentation and understood what was covered.
✔ Ensured all information supplied was correct and up to date.
The Outcome
Several weeks later, the seller unexpectedly accepted another offer and withdrew from the transaction. As the circumstances fell within the policy terms, David was able to submit a claim for eligible costs incurred during the purchase process. Cover can include conveyancing fees, survey costs, mortgage valuation fees and certain other transaction expenses, subject to policy terms and limits.
What David Did Right
- Purchased cover at the correct stage of the transaction.
- Provided complete and accurate information.
- Understood the policy terms.
- Retained copies of invoices and transaction records.
- Ensured the property met the eligibility requirements.
David's Experience
"The process was straightforward and gave me confidence that if something outside my control happened, I had some protection in place. Having experienced a failed purchase previously, it was reassuring to know I had protection against losing some of the costs involved."
David Turner
Scenario 2 - When Things Go Wrong
The Situation
Michael Harris was purchasing a property and had already completed several stages of the buying process before looking into protection insurance.
The Challenge
Michael had already commissioned surveys and searches and assumed he could arrange cover afterwards.
"I thought I could just take the policy out later once I knew everything was progressing." – Michael Harris
The Solution Attempted
Michael purchased a policy but failed to fully review the eligibility requirements and timing restrictions.
He:
✘ Applied after surveys and searches had already been completed.
✘ Assumed previous transaction activity would still be covered.
✘ Did not fully review the policy conditions.
✘ Failed to appreciate that certain circumstances may not be covered.
The Outcome
When the transaction later collapsed, Michael discovered that cover generally cannot be arranged after surveys or searches have already been completed because there may already be knowledge of issues affecting the purchase.
As a result, he was unable to benefit from the protection he expected and remained responsible for his transaction costs.
What Michael Could Have Done Better
- Arrange cover before surveys and searches are undertaken.
- Read the policy documentation carefully.
- Ensure all information provided is accurate.
- Check eligibility before purchasing.
- Understand what events are covered and excluded.
Client Feedback
"Looking back, I should have arranged the cover much earlier and spent more time understanding the requirements." – Michael Harris
Key Takeaway
Home Buyers Protection Insurance is designed to help protect eligible costs if a residential property purchase falls through due to specified circumstances. However, obtaining cover at the correct stage of the transaction and providing accurate information is essential. Cover should generally be arranged before surveys and searches are completed and before conveyancing work progresses too far.
