Insurance and Mortgages in WW2

Blisterman

I'm just after watching a documentary about the Blitz in the UK, and how thousands of houses were ruined.

And I'm curious what happened to people who had mortgages. I assume that since it's an act of war, the insurance companies wouldn't pay out.

So, were a lot of people, who'd already had their houses destroyed and lives ruined, have to continue making mortgage payments for decades after the war, for a house that was completely destroyed?

hivizman

There was legislation, for example the War Damage Act 1941, that provided some relief in these circumstances. First, remember that owner occupation was much lower in the 1940s than it was now, and many of the properties in cities that suffered bomb damage were rented rather than owned outright. The Landlord and Tenant (War Damage) Act 1939 waived rent due on properties that were uninhabitable owing to war damage, and made it very difficult for landlords to evict tenants. Where there was a mortgage on the property, the payment of interest was suspended until the War Damage Commission could assess the necessary compensation, which was paid by the Government. The first claimant on the compensation was the lender, however, so the owner of the house could end up with no mortgage but with just a plot of land and no money to finance the rebuilding. This provided opportunities for speculators to buy up empty plots of land, and several major property companies had their origins in the years of and just after World War II.