Folksy Ltd

House title deeds and insurance

We bought our first house a couple of months ago and I read online that home run craft businesses should check title deeds and tell home insurance about our work.

I read over house deeds and they appear to say I cannot run a business! Has anyone else come across this? I have asked solicitor to clarify.

Haven’t told insurance yet, but is it likely our payments will increase? I’m only using things I already had as a hobby like sewing machine, glue gun, and newly bought sizzix machine.

Has anyone had experience of these things?

Do you own the freehold of the property? If so then there should be no restrictions in place on the deeds. If your property is subject to a head lease or long term lease then you might well be restricted as to what you may use it for. Particular properties may also be subject to terms called “easements” which give some third parties, usually your neighbours, certain rights in relation to your property (like access to a shared driveway). These should be written into the deeds.

Talk to your household insurer about whether or not they wish to add any terms or apply an extra premium. My suspicion is that they will not. Many keen DIYers have propane torches and heavy duty tools and these are not normally excluded, but if you have disclosed them then they can’t refuse a claim on those grounds.

Sam x

I should also add that this area of the law is a bit out of date. Many houses which have restrictions on “business use” in the deeds relate to not being able to change the house into a shop, in order to keep the area it is located in purely residential. Clearly this does not reflect the modern reality, where many, many people run online businesses without changing the character of an area in the slightest. Your solicitor will be able to advise you if you are able to continue, and once again, my suspicion is that you will.

Sam x

Thanks Samantha. We are in Scotland and we have a Feuhold. I believe this is similar to a freehold.
Our solicitor said that strictly our deeds say I’m not supposed to, but kind of echoed the ‘old fashioned’ thing and agreed that its not like I’m changing the use of the house etc, so said its fine and that it wold only become an issue if a neighbour complained, which I think is unlikely. No idea who they’d complain to anyway!

Home Insurance on the other hand has said they need to note what I’m doing, but then said they cant do it and I have to put in a whole new application sigh. The insurance broker we used is very helpful and she is now going to sort it all out for me.

All is this is so complicated already and I literally have 5 items listed. I’m a worrier though and I need to know all this is sorted though before I throw myself into listing more items.

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I’m not that familiar with Scots law but this part does seem to be quite similar to English law. The point of the old land law was that they didn’t want parades of shops popping up without the powers that be having a large say-so in where they were. This is clearly something that applied 50 years ago but is really strange these days! Insurance companies can make their own rules up and if they want something from you in writing then you have to go with it. Brokers are usually very good at sorting these things out, and as I said, I would be extremely surprised if they wanted any additional premium. I used to work in insurance, and generally they would rather keep your business once you are with them for the year :wink: Caution is always a good idea tho!

Sam x

We have come across insurance companies that will not quote when you advise them that you are running a business from home. Many others however are fine with it and some can even include a homeworkers element to your cover for next to nothing. For small enterprises run from home these policies can be very useful.
Your broker will sort it for you .
Dave and Dos

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I suspect the fact that you guys are operating a kiln played a part in your home insurers decision. The underwriting department of an insurance company can make decisions based on all the individual circumstances of the persons proposing a policy and a kiln represents a significant fire hazard.

Sam x

If you are allowed to then be aware that you can claim a tax allowance on your council Tax and utilities while ‘at work’ in the premises. I was delighted about this.

Thanks everyone, we have been back and forward with broker who set up our insurance in the first place and the insurance company. The insurance company today phoned and said it is going to underwriter again to see if there will be an extra premium. They also went through some odd rules, like I could have no more than 2 business related visitors per week, not including deliveries. I don’t plan to have any business related visitors, so thats good!

Will check back and let you know if the price went up, incase it helps anyone x