What is Rights to Light Insurance?
Over time the owner of a property gains a right to continue to receive natural daylight for the continued enjoyment of their property.
Rights to light or rights of light can be documented in the Title documents to the properties but, in the absence of specific documentation, it will usually be the case that any building over 20 years old may have a right to light.
If a planned development may infringe the right to light then a neighbour can prevent development through an injunction or be entitled to substantial damages.
In what circumstances is cover required?
Where there is a proposed development of a Property which may give rise to a third-party claim that their common law Rights to Light has been infringed. This could include new developments or changes to existing properties.
The risks can be substantial and recent Court decisions have extended these, including a decision in HKRUK II (CHC) Ltd v Heaney which involved a property benefitting from the right to light being used for commercial purposes.
A Rights to Light claim has the ability to significantly reduce the profitability of a planned development and, in some cases, prevent development completely.
Rights to Light surveys:
Rights to Light surveys will normally be required. A good rights of light report will typically cover the following areas:
- Calculations to confirm whether or not rights of light are injured
- Identification of injunction risks
- Compensation valuations where risks identified
- Costs of ‘cut-back’ of the development to reduce or eliminate the infringement
- Advice on the appropriate strategy for dealing with rights of light risks
Risks covered: compensation payable to third parties whose rights have been infringed, loss of profits in the event that a development is cut back or abandoned and costs and expenses.
- Compensation payable to injured properties
- Costs of complying with an injunction
- ‘Cut back’ losses in the event that the development is restricted
- Professional/legal fees
What does a Rights to Light Insurance cost?
The cost and other terms vary enormously from case to case and between insurers. There are also a variety of approaches and terms, some involving pro-active contact with affected neighbours while keeping insurers involved, others with excesses reflecting what is seen as a ‘sensible’ level of compensation leaving insurers exposed to the unexpected.
The only way to understand the range of terms available is to contact us with the relevant information and we can advise you on the options.