The Government has made the decision to close the state-backed External Wall System (EWS1) Professional Indemnity Insurance (PII) Scheme on 30 October 2023.

The Scheme was intended to be a short-term solution for assessors who were unable to purchase suitable professional indemnity insurance to conduct EWS1 surveys. The lack of appropriate insurance cover meant that EWS1 forms were difficult to obtain, and leaseholders in turn could not re-mortgage, buy, or sell their homes without an EWS1 form.

Government action has helped to address this market failure. The relevance of EWS1 forms is declining as wider Government interventions have taken effect that support lenders to use other forms of documentation to support commercial lending decisions. Our research shows insurers are offering professional indemnity insurance for EWS1 work and that assessors can access suitable insurance from the open market at a competitive premium and with a wider scope of coverage. The market has responded to the protection gap the Government was looking to address, which removes the requirement for the Government backed Scheme and so providing it is no longer a good use of public funds.

Policies sold under the Scheme to date will continue to be insured under the original terms. Please note that any pre-existing quotes obtained up to 30 October remain active for their respective 30-day validity period and can be retrieved using the quote reference.

For more information, please contact MGAM at EWS1help@MGAMutual.com.