Legal Indemnity Insurance policies for issue by solicitors and conveyancers

Breach of Leasehold Covenants

What are the key covers, features and benefits?

This legal indemnity insurance policy is for known breaches of leasehold covenants, such as the addition of an extension, a conservatory or rearranging the room layout of a leasehold property without the freeholder’s written consent.  The freeholder can, in certain circumstances, forfeit the lease where such breaches have taken place.

A breach of leasehold covenant policy would compensate the Insured in the event that the freeholder takes action in respect of the breach – this could be by demanding monetary compensation, insisting on the removal of the offending structure, if appropriate, or even taking steps to forfeit the lease.  

The policy also covers the Insured’s legal costs in defending the breach and if unsuccessful any costs awarded against them or in favour of the freeholder; in addition to this, it would cover costs of alteration, demolishing or reinstating part of the property and any consequential diminution in value.


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