Don’t Mistake This Insurance Clause for a Contingency

The insurance provision in the OREF Sale Agreements is an advisory, not a contingency. If the purchase is being financed, the lender will require property insurance, and not getting insurance would mean failure of the financing contingency. If there is no lender, insurance coverage would not be a contingency, so the buyer could lose their earnest money. If the cost of insurance is a concern, the buyer may need to include a contingency allowing them to terminate if they are unable to obtain insurance at a reasonable price.

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