Humber/Ontario Real Estate Course 3 Exam Practice

What should a buyer do regarding insurance coverage when purchasing an older, remote cottage?

1. Will likely be unable to secure insurance due to age and location

2. Confirm with seller that insurance is available

3. Insert a condition in the offer concerning obtaining insurance

4. No concern as insurance is readily available

5. Consult multiple insurance providers for better rates

6. Investigate insurance availability after purchase

The correct answer is: Insert a condition in the offer concerning obtaining insurance

When purchasing an older, remote cottage, it is prudent for a buyer to insert a condition in the offer regarding obtaining insurance. This approach allows the buyer to ensure that they can secure the necessary insurance coverage before fully committing to the purchase. Given the unique factors related to older properties and their location—such as potential functionality issues, structural integrity, or increased risk from natural elements—insurance may not be readily available or could come with higher premiums. Including this condition provides an added layer of protection for the buyer, allowing them to back out of the deal if insurance cannot be obtained on satisfactory terms.