If You Are Selling Your Home:
Kindly instruct your home insurance agent that fire insurance coverage is to be cancelled on the property with the closing date as the effective/cancellation date. If for any reason the closing date is amended or changed to a new date it is imperative that you re-contact your fire insurance company to ensure that coverage is maintained until the actual sale transpires and is completed. You should also be aware that if you are selling your property and it is to be vacant for more than thirty (30) days prior to the closing date it is imperative that you advise your fire insurance company to cover the risk due over due any vacancy prior to closing. Also, kindly advise your insurance agent to forward to our offices, after closing, an insurance release form setting out that they no longer have any interest in the property.
If You Are Purchasing a Home:
Please be advised that it is all mortgage company/bank procedures that we must have a fire and contents insurance “binder letter”; from your home (fire) insurance company prior to closing. We cannot close your transaction without such fire insurance binder letter and as such it will need to clearly set out the name of your mortgage company/bank as first loss payable, with guaranteed replacement value. Make sure your insurance agent faxes such binder letter to our offices prior to closing. If there is any difficulty in that regard, and as an aside, kindly provide us with your insurance agents name and contact phone number so that we may follow up on your behalf.
Similarly if you are purchasing a condominium, although the condominium corporation will have its own blanket insurance coverage in place covering the entire condominium corporation and its assets, it is still necessary for you as the unit owner to arrange insurance for contents of the unit and for public liability. We will still require such insurance binder letter in this regard for your mortgage company/banks satisfaction.
*All insurance policy binder letters should show the closing date as the effective date.