- FWMember@fwJoin Date: 2002Post Count: 478
A question about insurance.
It’s been suggested to me that once a purchase contract goes unconditional, I should insure the house I’m buying. That makes sense.
But I’ve also been told that when I wrap the house, the owner is still the one who insures it, and the suggestion was that I send in two application forms at that stage – one filled out by me, the owner, and one filled out by the wrap buyer, as the occupier.
I’ve also found after a number of phone calls to insurance brokers today, that insurance companies aren’t the slightest bit interested in this sort of arrangement nowadays.
Now, that could just be because the insurance brokers don’t know, although one in particular deals a lot with investment property and had tried to source wrap insurance as I’ve described only a few weeks back.
Anyway, I guess the gist of all this – what do other people do? Does anyone have an insurance company that has insured a wrap property recently?
Any other hints or tips???
FelicitySteve McKnightKeymaster@stevemcknightJoin Date: 2001Post Count: 1,763
Congrats! You have managed to completely confuse me with your post 
As far as insurance goes, here are my thoughts:
1. You should insure the property for land and building insurance the second you sign the purchase contract. It’s a bit like getting car insurance before driving out of the car yard.
2. In a wrap you have two choices:
Option A: Have insurance in your name and have your mortgage and your client registered as having an interest in the policy. You pay and then get reimbursed by your client, OR
Option B: Have the insurance in your client’s name and have you and your lender noted as having a registered interest. Your client pays the policy and sends confirmation by way of a certificate of currency to you.
If you go with Option B then make sure any insurance proceeds go to you direct.
Whatever you decide, be very careful to ensure that you find out all the information about your client to ensure they don’t have a horrible past that may allow the insurance company to later claim that they wouldn’t otherwise of insured the property and that you didn’t make a full disclosure.
Some time ago I was working with an insurance broker to develop a wrap specific policy that protected against this risk. Negotiations stalled when they went broke and now I’ve had to start the ball rolling again dealing with someone else.
So much to do, so little time… I’ll report back if I hear any news.
Steve McKnight | PropertyInvesting.com Pty Ltd | CEO
Success comes from doing things differentlyFWMember@fwJoin Date: 2002Post Count: 478
Thanks for the feedback Steve, sorry to have confused you! I’m a little confused myself!!! 
For now I will certainly insure the property up until settlement, but from my phone calls on Friday it’s the next step that’s the tricky bit. But perhaps if I already have insurance in place I’ll be able to negotiate a bit more. Sometimes it seems that ringing up and speaking to a call centre person at random isn’t always productive
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