When buying or selling a home, insurance isn’t just a formality—it’s a critical requirement for closing. Here’s what you need to know to avoid delays or complications:
1. Lender Requirements
All lenders require insurance to be in place before funding the sale. Your lawyer or notary must confirm this at closing. Without proof of coverage, your closing could be delayed.
2. Quotes vs. Confirmed Coverage
A quote is helpful for planning, but it doesn’t guarantee that coverage will be approved. Local risks, such as wildfires or other natural disasters, have led to insurance being denied even after a quote was issued. The safest approach is to secure a binder of insurance, which guarantees coverage is in effect.
3. Selling a Home at the Same Time
If you’re selling your current home while buying a new one, do not cancel your insurance until after your closing. This protects you in case the buyer’s financing or closing is delayed.
4. Strata Considerations
Most strata-titled properties are already covered under the strata corporation’s main policy. The exception is bare-land strata, which requires separate coverage for the primary building and structures on the lot.
5. Resources
BC Wildfire Map – Check local risks that may affect coverage availability.
Bottom Line
Insurance is a vital step in both buying and selling a home. Securing coverage early, preferably with a binder, ensures your closing goes smoothly and protects your investment.
