Hazard Insurance

Due Diligence Information for Home Buyers Regarding a Property’s Insurability


Within 10 days of the “Time Reference Date,” the Buyer shall obtain a commitment for hazard insurance from an insurance carrier.

It is important for a Buyer to contact their insurance agent early in the 10 day inspection period, because quite often the insurance agent has to visit the Property in order to inspect the insurability of the roof. In some cases they will say that the roof will have to be replaced. For example, in the case of a house where asbestos shingles were put directly over a wood shake roof, the insurance company will not be able to provide full replacement coverage unless the roof is replaced.

All explanations, representations, and disclosures concerning the terms, conditions, and provisions of a commitment for hazard insurance coverage and/or hazard insurance policy are the responsibility of the Buyer’s insurance agent and not of the Seller, the brokers or their sales associates.


Until the Closing or transfer of possession the risk of loss to the Property, except for ordinary wear and tear, is the Seller’s. After Closing or transfer of possession, the risk is the Buyer’s.

If transfer of title and possession do not occur at the same time, the Buyer and Seller are advised to seek the advice of their insurance agents concerning the insurance consequences.


If the Buyer does not exercise the Buyer’s right to cancel the Contract based on the inability to obtain acceptable hazard insurance coverage, by delivering written notice to Seller, in care of the Listing Broker, within 24 hours after the expiration of the 10-day time period specified in the Contract, or the Buyer fails to obtain a loan based on unavailability of hazard insurance coverage, the Buyer shall proceed to Closing, regardless of the unavailability of hazard insurance coverage, or be subject to the breach and failure to close provisions of the Contract.

I recommend getting a roof inspection by a licensed roofer who is certified to do roof inspections. Here is why. There is evidently a loophole in the Oklahoma insurance laws that allows the insurance company to cancel a homeowner’s insurance policy within 60 days of closing, even if they said before the closing that the property was insurable. No kidding! This happened to one of my clients who had contacted her insurance agent prior to closing; the agent had driven by the house and said the house was insurable. However, the insurance company changed it’s mind after she closed and moved into the house; the insurance company made her put a new roof on the house. So don’t take the chance that your roof won’t be insurable.