LDC vs Planning Indemnity Insurance: which one actually protects you?
Every page on this topic today is written by an insurance broker selling indemnity. We're not one. Here's the comparison nobody else will write — including when indemnity is genuinely the right call, and when it's a plaster that leaves the wound open.
Check which you need →The one-line difference
A Lawful Development Certificate resolves the question. The council writes you a document that says the development is lawful. You own that document forever; it transfers with the property; any future buyer's solicitor can read it and move on.
Planning indemnity insurance insures the consequences of the question. An insurer agrees to pay out if the council takes enforcement action against the unauthorised work. The underlying lawfulness question stays open. Next buyer's solicitor asks the same thing, and the next owner pays for indemnity again.
Which one is right for you depends on timing, price sensitivity, and — crucially — what your buyer's solicitor will accept.
Side by side
| Lawful Development Certificate | Planning Indemnity Insurance | |
|---|---|---|
| Resolves lawfulness? | Yes — council writes it down | No — insures consequences only |
| Transfers to future buyers? | Yes, permanently | One-shot; next buyer starts over |
| Cost | £613 all-in with LDC Express | £20–£300 typically |
| Turnaround | 8–12 weeks (council decision) | Same day |
| Covers known enforcement? | N/A — but resolves the issue | No — most policies exclude known enforcement |
| Accepted by all buyer's solicitors? | Yes | Usually, but not always |
| If you've owned <4 years | s.192 available pre-build, s.191 tight | Some insurers decline or surcharge |
When indemnity is the right call
- You're exchanging in less than 4 weeks and can't push the date.
- The buyer's solicitor has explicitly said "indemnity is fine". Don't overspend if they've already blessed the cheap path.
- The underlying development is almost certainly lawful but you don't have time to prove it with an LDC. Indemnity here is cheap peace-of-mind, and the risk the policy has to pay out is low.
- You don't plan to sell again for decades and the next owner can fight their own battle.
When an LDC is the right call
- The buyer's solicitor has specifically asked for an LDC and will not accept indemnity. This is common with higher-value property transactions and with certain conveyancing firms.
- There has been any previous council contact about the development — a warning letter, a visit, an informal "we noticed your extension". Indemnity almost always excludes known enforcement; an LDC resolves it permanently.
- You expect to sell again within 10 years. Every future sale asks the same question. An LDC is a one-time fix; indemnity is a recurring cost.
- The property is higher-value and the buyer's lender is strict. Larger mortgages come with tougher requirements; indemnity gets rejected at ~3× the rate on these.
- You want to refinance. Lender checks re-surface the same question every time.
The honest cost stack
People look at £20 indemnity next to £613 LDC and think the choice is obvious. It isn't. The fair comparison is:
- Indemnity at sale 1: £150. At sale 2: £180. At sale 3: £220. Plus the small but non-zero risk that one of those buyer's solicitors rejects indemnity and you have to get an LDC anyway — from under time pressure — at £613.
- LDC once: £613. Transferable forever. No recurring cost, no risk of a future rejection.
If you're a long-term owner or sell within a decade, the LDC is cheaper over the lifetime of the property. If you're about to sell and never selling again, indemnity wins on pure cost.
What we'd do in different scenarios
- Sale in 10 weeks, no council contact, work done 2019: Start the LDC today. Plenty of time. Settles it permanently.
- Sale in 3 weeks, no council contact: Indemnity. You don't have time for an LDC. Ask the buyer's solicitor upfront.
- Sale in 6 weeks, but the council sent a letter about the extension last year: LDC or renegotiate completion. Indemnity won't cover known enforcement.
- Not selling — planning to build something next year: s.192 LDC before you build. £613 is cheap insurance against a refused retrospective application later.