Listed Buildings Insurance

A useful guide to Insurance for Listed Buildings

Throughout the UK, there are thousands of homes, structures and buildings which have been designated as having special significance for national heritage. As a “listed” building, these structures must be maintained and kept in their original condition, which places limitations on what the owners of these properties can do; should they wish to alter the property, or to carry out repairs, they’ll need to check with their local council before doing so.

As an owner of a property like this, the householder has a responsibility to make sure that their home is kept in the condition which is required by the government. These rules have been put in place to ensure that the character of British architecture isn’t lost through relentless re-development; listed properties are selected for their importance to local culture or to the nation’s heritage, and as such their owners cannot be allowed to extensively modify the property. If they were, we could stand to lose much of the country’s fine architecture as the property’s owners modified and remodelled at will.

Because listed properties must be maintained as cultural artefacts, if they suffer damage and require repairs this can often be very costly; it may be necessary to make use of expensive techniques or outdated methods to restore the property. The care and authenticity required when repairing a listed property makes it all the more important to invest in a sound and secure listed building insurance policy to cover every eventuality, even more so than with a standard building insurance policy. To understand how listed building insurance works, it is first necessary to see how the UK’s catalogue of listed building came to be created, and what it means to own one.

What is a Listed Building?

Broadly speaking, a listed building is one which has been designated as having special cultural significance for the country’s heritage, and which must be maintained for future generations. These differ from “scheduled monuments” like Stonehenge, which are protected by much older non-statutory legislation, and though the precise details of the listing schemes in each part of the UK might vary, they all have several systems in common.

The idea of “listing” building with national significance was floated as early as 1843, but the idea of restricting what the owner of a property could do with it was held to be a step too far. It wasn’t until the 1940s when a national list of properties was created, in response to the falling German bombs of World War II. With extensive damage to the nation’s architecture, it was important that as much of the country’s heritage was preserved as possible; the government therefore sent out hundreds of inspectors to create the first catalogue of listed buildings in the UK.

There are three “grades” of listing in the UK; Grade I, Grade II* and Grade II. These can be thought of as reflecting the overall national significance of the structure, where Grade I is the most valuable and Grade II is the least. However, it’s important to stress that although a property might be Grade II listed, it is still deemed to be worthy of every effort to keep it in its original condition; the grade boundaries reflect the national significance of a structure, and not its value.

Grade I listed buildings include the Clifton Suspension Bridge in Bristol, the Palace of Westminster and London’s Tower Bridge. These buildings are clearly part of the fabric of national life and are globally recognised; their listing as Grade I structures reflects that they’re extremely important nationally, and that every effort should be made to maintain them as cultural treasures.

Grade II and II* are less distinctly different, and share some characteristics. In general, Grade II* listed buildings are generally held to be more significant than Grade II ones – examples of Grade II* structures include the Tees Transporter Bridge in Middlesbrough (the longest remaining transporter bridge in the world) and Capel Manor House, a modernist home constructed almost entirely from glass and held to be the finest structure of its type in the UK. Grade II listed buildings are those which have cultural significance and are deserving of protection, but which have a more locally-focussed scope. For instance, some examples of Grade II listed buildings include the Birmingham “back-to-back” houses, and Broomhill Pool in Ipswich.

Listed properties are typically pictured as old houses, and in many cases this is true. Every property in the UK which was built before 1700 and consists mainly of the original structure and materials will be listed, and most of the buildings constructed between 1700 and 1840 will be listed too. However, although almost every old property in the UK is listed, this doesn’t mean that every listed property in the UK is old, and there are several examples of buildings constructed in the past fifty years which have been listed. A good example of this is the Lloyd’s Building in London, an enormous structure created from steel and glass in the mid-1980s to house the famous banking firm. This property was listed as a Grade I building in 2011, putting it in the same category as Buckingham Palace and Blackpool Tower. Other modern buildings have also been granted listed status; Battersea Power Station, for example, is a Grade II* listed building and the BT Tower in London is listed as a Grade II building.

Owning a Listed Building

Taking on ownership of a listed building can be both a blessing and a curse. The period features and general character of these properties can really make buyers fall in love with them, and they certainly can have a charm all of their own. Owning a listed building, however, comes with responsibilities beyond that of regular home ownership, as the owner is also responsible for maintaining part of the country’s heritage. This means that there are far more rules and regulations that must be followed; it’s crucial to understand what additional responsibilities ownership of a listed building entails.

Obtaining Planning Permission

Before making any major modifications to your home, you’ll need to apply for and receive planning permission. For unlisted properties, this generally means that if you want to carry out extensive external remodelling, such as an extension, you’ll have to check with the local council first. However, the character of a listed building is protected under law, which means that there are many more criteria to satisfy when applying for planning permission.

Firstly, planning permission must be sought for fairly minor modifications when the property is listed; for any alterations either internally or externally, you’ll need to apply for “listed building consent”, for which the approval of a specialist council officer is required. It can be possible to make surprisingly significant changes to a listed building, such as removing internal walls, but the council will want to understand what your reasons for removing it are and how you intend to retain the character of the property. In essence, with a listed property you’re likely to find that planning permission is required in more cases than if your property wasn’t listed.

You’re also likely to discover that it’s harder to make alterations to the exterior of your property. Because the building’s exterior is a large part of what makes it culturally significant, any modifications must be in keeping with the historical context of the property as a whole; you can’t just bang on an extension or a conservatory. If you should make modifications to the property which aren’t approved by the council, they have the power to compel you to put the property back the way it was – no small punishment if you’ve had to pay out thousands for an extension already. In addition to this, unauthorised alteration of a listed building is a criminal offense, and individuals who make modifications to their home without proper authorisation can be prosecuted.

Carrying Out Repairs

The requirement to retain the property’s character also means that if the exterior of your property needs repairing or replacing you’ll have to do so in a way that maintains the property’s character – if the roof needs re-tiling it’ll have to use similar tiles to the originals, which can often be a much more expensive option. Maintaining the property in original condition is also an important consideration for owners of thatched cottages; re-thatching will need doing every decade or so, and is a major expense.

Unfortunately, listed properties can also be susceptible to more problems than modern properties, due to the simple fact that they were constructed using old building techniques and have had to last a long time. It’s not uncommon for older listed buildings to develop a laundry list of recurring issues such as leaky roofs, unreliable electrical connections and poor plumbing. The nature of the original fixtures and fittings often means that these problems will continue to crop up over and over again – as one leak is fixed, another section begins leaking. Maintenance of a listed property can therefore be more demanding than maintenance of a newly constructed one.

It’s very important to keep on top of maintenance and repairs for a listed building, because it’s easy for issues to cascade and cause further problems. A leaky bathroom tile, for example, might cause damp to spread through the floorboards, requiring that they be pulled up and replaced, something which a newer build might be more resistant to. In addition to the possibility of one problem causing many others, it’s also often more expensive to repair a listed building due to the requirement to use appropriate materials; you might find that just any old floorboards won’t do, and you’ll have to use a specific type of authentic floorboard which is much more expensive.

Selling Your Listed Building

Owning a listed property can be very satisfying, since they’re often very beautiful. Those who take pride in their home will be happy to pay the price of more expensive, more frequent repairs in order to call a listed building their home, but they are in the minority in the real estate market as a whole. For many people, listed buildings are a worrying proposition; as we’ve seen they can require a lot of expensive work and investment and offer few opportunities for modification. It can therefore be difficult to find a buyer if you decide to sell your listed home, and many homeowners have to turn to specialist real estate agents rather than mainstream ones.

An alternative solution is to register the listed building for sale with a specialist auction house, where you can be sure to find an audience of interested buyers. However, selling through an auction house does not always guarantee you a good price and leaves no room for negotiation on the sale – an agreement is made as soon as the hammer comes down.

Insurance for Listed Buildings

We’ve seen how expensive it can be to keep a listed property in good condition, and how much work it can take to ensure that the building is maintained to an adequate standard. However, if something goes really wrong, it can be extremely expensive to restore the property. There are many issues that can cause a listed building to require extensive repairs, from fire to flood to structural faults, and should the property need to be repaired it will have to meet the requirements of the listing committee.

Insurance for a listed building is similar in many ways to standard home insurance policies which cover the structure of your home against damage. However, the higher potential costs of repairing a listed structure mean that not every insurer will offer products for listed buildings, and you may need to talk to a specialist insurer instead. As with any form of insurance, the higher risks associated with a listed property make it likely that you’ll have to pay a higher premium on your insurance, but you should make sure that your policy is watertight and covers you in any eventuality.

What to Supply When Applying for Listed Building Insurance

Applying for listed building insurance is in many ways similar to the normal process of applying for building insurance. The main details which you need to provide are the same, but you’ll also need to present some additional information to allow the insurer to judge how risky it is to insure your home against damage.

Property Age

The older your property is, the more likely it is to be highly expensive to repair. This is due to the need to use building materials which match the original structure: for instance, rebuilding a property with ornate 1850s-style brickwork is far harder and more costly than doing so with brickwork from the early 20th century – it’s easier to reproduce more modern building techniques than those which are long outdated. Similarly, a 15th century timber-framed home would need the services of highly specialised craftsmen, who don’t come cheap.

Previous Work Carried Out

A property which has already required work to be carried out might need further work to be carried out in the future. If your building has a clean bill of health it sends a good signal to insurers that your home is less likely to need work carrying out – it shows that the home has been well looked after and kept in a good state of repair.

Property Valuation

As with any home insurance policy, you’ll need to let the policy provider know how much your home is worth. However, they might insist on an up to date valuation, and you may have to contact a specialist in listed property valuation before applying. This isn’t necessarily a huge expense, but it should be something you bear in mind when gauging the cost of an insurance policy.

Previous or Upcoming Alterations to the Property

The provider of your building insurance policy will want to know whether the property is in its original condition, or whether parts of the building have been modified from the original plans. This can affect the cost of repairing and restoring the listed building in the event of extensive damage, and should be something you make the insurers aware of.

Listed Building Insurance and Ownership

Owning a listed building is a dream for many people, and the many positive aspects of these properties should not be overshadowed by the potential for problems to arise during ownership. It is important, however, to appreciate just what it means to own a listed building.

The responsibility that the owners of listed buildings have as custodians of part of Britain’s history means that they must ensure their home is kept in good condition, and part of this is taking out a comprehensive and effective listed building insurance policy. Without this, it’s possible to be caught between a rock and a hard place, where the law requires the property to be returned to its original condition but the cost of doing so is extremely high. However, with a good understanding of the basics of listed building insurance, owners of listed properties should be confident that they won’t be liable for these huge expenses.

Further Reading

Official resources about UK financial regulation:

Other Unofficial Guides

Covering areas of UK regulation on and aspects of Hotel Mortgages.

Research provided by Falbros