Passing of risk

The answer to the question of who is liable for the costs of repairs to damage caused by a leaking geyser for example depends on who has taken out insurance. Has the seller kept the property covered until the date of transfer, or has the buyer taken out a new policy effective from the date on which he takes occupation?

According to Chass Everitt, MD of Chass Everitt International Property Group, it is a good idea to allow the risk in the property to pass from the seller to the buyer on transfer of the property, and not on occupation - and to double check that this is written into the agreement of sale.

Such an arrangement means that careful sellers will stay fully insured until transfer, and that there will be no need for buyers to take out special insurance.

Article on News24

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