Right of Light Insurance for Developers and Landowners
What are Right of Light?
If a new building reduces the amount of light coming in through a neighbours window, and the level of light inside falls below the accepted level, then this constitutes as an obstruction unless the owner of the affected window waivers their rights.
If they do not waiver their rights, they will be entitled to take legal action against the landowner, if a Rights of Light expert considers that the light is being blocked.
This could result in the neighbour seeking a court injunction to have the development reduced in height and size, or in some cases compensation may be paid.
What is Right of Light Insurance?
Right of Light Insurance Policies protect the developer or landowner from Rights of Light claims, where a neighbour claims they have had their amount of light reduced.
Why take out a Right of Light Insurance policy?
Right of Light indemnity Insurance will protect a developer from the risk of a possible future claim on a specific development in respect of the obstruction or reduction of a neighbour’s Rights of Light.
Recent cases such as HKRUK II v Heaney (2010) have highlighted the legal system’s increasing willingness to award an injunction against the developer rather than simply compensating the injured parties.
The costs of compensation/damages can be significant, often being based on up to 30% of the developer’s profit. However, this is still significantly less than the cost of an injunction requiring the demolition of the offending part of the development, possibly following completion and occupation.
Therefore, in order to allow a development to proceed without the delay or waiting for the conclusion of Rights of Light matters, a developer can take out an insurance policy to protect themselves from the range of potential costs and diminution in value associated with a legal claim and any consequences of its outcome.
Right of Light Insurance will cover the following costs:
Policies provide two forms of protection:
• The insurer will pay all legal costs involved in addressing claims against a developer including compensation to the injured party. The policy will cover identifiable loss from adjoining owners as identified by the Rights of Light surveyor.
• The insurer will cover the cost of any financial settlements, to include damages awards, abortive costs incurred as a result of a third party claim, and loss in land value in the event the developer’s project is permanently halted by the Court.
Each policy is tailored to the individual development and runs for perpetuity.
Initial information we require:
• Surveyors rights of light report
• Site plan
• Copy of the planning consent
• Photographs of the site and adjoining premises
• Copy of the claim/s for Rights of Light infringement