Under SCS 5.1.2, who bears the obligation to insure the property?

• A. Buyer
• B. Seller
• C. Lender
• D. Insurance company

Answer: (A)

The obligation to insure the property falls on the buyer. Once completion occurs, the purchaser becomes the owner and bears the responsibility to have buildings insurance in place for the property, typically naming the lender as an interested party if there’s a mortgage. The seller may have insured up to completion, but from that point forward the buyer must maintain cover to protect the value of the asset and satisfy mortgage conditions. The insurer provides the policy, while the lender’s role is to require and verify that insurance exists and covers the property; they do not bear the obligation themselves.