Defective title insurance

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A defective title indemnity policy insures against potential liability arising from a specific title defect. Defective title indemnity policies are widely used in the property industry.

If a title defect or breach of a restrictive covenant is identified in the due diligence process, this can affect value. As a result:

  1. •

    a lender may be less willing to finance the purchase of the property, and/or

  2. •

    a buyer may seek a price chip

A defective title indemnity policy does not remedy the title defect, it is an indemnity against loss. If it is available in the market, it can offer a solution to deal with the risk caused by the title defect and thereby allow the transaction to proceed. Insurance may not be an appropriate solution where the possible consequences of the risk materialising or being enforced are not solely financial. Some common title defects that may be insurable include:

  1. •

    lack of rights—for example a required right of way or services: a title indemnity policy can provide compensation for loss in the event that the owner is prohibited from exercising a right of way, or using services,

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LMA publishes amended guidance note on the ROE Regime

The Loan Market Association (LMA) guidance note on the Register of Overseas Entities (ROE) has been amended to reflect changes introduced under the Economic Crime and Corporate Transparency Act 2023 (ECCTA) and subsequent regulations effective in 2024 and 2025. The latest version of the guidance note integrates the new ECCTA provisions and clarifies compliance requirements for overseas entities that own or acquire UK property. The focus is on enhanced ROE transparency, verification, and annual reporting obligations. The LMA has confirmed that existing real estate finance documentation remains broadly compliant, with optional refinements for risk mitigation.

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Property weekly highlights—30 October 2025

This week's edition of Property weekly highlights includes: Royal Assent of the Renters’ Rights Act, failure of the challenge to the Leasehold and Freehold Reform Act 2024, updated to the LMA guidance on the Register of Overseas Entities Regime and cases on disputed beneficial interests, proprietary estoppel, a mortgagee’s power to surrender and breach of tenant covenants in a residential lease.

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