Buying a property isn’t always a straightforward process, and one area that can cause confusion is
the question of who is responsible for insuring it between the signing of the contract and
settlement. There are differences in regulations between states, but the basics are as follows.
When it comes to property insurance, there can be some grey areas, but it’s important to
understand your general obligations. Additionally, if both parties are insured throughout the entire
process, it saves the headache should anything go wrong.
As the vendor, if there’s substantial damage to the property but the purchaser still wants to go
ahead with the sale, you may need to consider a negotiation on price, or you may need to fix the
damage before settlement. If you’re still insured, your insurance policy will cover the work needed.
For purchasers, if there’s substantial damage, you have the option to negotiate a price reduction
or alternatively get out of the contract.
Importantly, it’s the vendor’s obligation to leave the property in the same condition it was in when
contracts were signed, regardless of who holds risk over the property.
This is a complex area that can be hard to navigate without support, so it’s a good idea to talk to
your mortgage broker to gain a clearer understanding of how best to proceed and protect yourself.
For detailed advice about property insurance in your State, contact an experienced property
Phone: 0426 241 741 | 03 9372 7964
Head Office: First Floor, 279 Napier Street, Strathmore, VIC, 3041
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Brookline Financial Services Pty Ltd is an Authorised Representative of Count Financial Ltd ABN 19 001 974 625 AFSL No. 227232 which is 85% owned by CountPlus Limited ABN 111 26 990 832 (CountPlus) of Level 8, 1 Chifley Square, Sydney 2000 NSW and 15% owned by Count Member Firm Pty Ltd ACN 633 983 490 of Level 8, 1 Chifley Square, Sydney 2000 NSW. CountPlus is listed on theAustralian Stock Exchange. Count Member Firm Pty Ltd is owned by Count Member Firm DT Pty Ltd ACN 633 956 073 which holds the assets under a discretionary trust for certain beneficiaries including potentially some corporate authorised representatives of Count Financial Ltd. The information on this web page is not advice and is intended to provide general information only. It does not take into account your individual needs, objectives or personal circumstances.