DISCLOSURE OF KNOWN RISKS
Any known risks relating to a property to be insured at the time of ordering a title insurance policy must be disclosed to Stewart Title. This duty to disclose any known defects continues from the time that the policy is ordered up until settlement.
When disclosing a known defect to us, we ask that you provide us with copies of the documents and/or information that you consider relevant to the risk. Examples of documentation and/or information may include:
- special conditions;
- correspondence with the vendor’s solicitor;
- pre- purchase building inspection reports which indicate that a structure may be illegal or may be defective or structurally unsound; or
- information obtained verbally from the purchaser who has become aware of a known defect during discussions with the vendor.
Pre-Purchase Building Inspection Reports
Many prospective purchasers obtain a pre-purchase Building & Pest Report prior to exchange of contracts or during a cooling–off period.
Whilst most Reports focus on the condition and repair of a property, often a Report will contain information as to the method of construction of a structure and its likely compliance (or lack thereof) with Council regulations and building codes and standards.
Often a Report will highlight significant defective work or work which may not have been constructed without Council approval or work which appears to be structurally unsound.
It is important that any matters contained in a Report which relate to building compliance, dilapidation, structural integrity or defective workmanship be disclosed to Stewart Title as soon as possible as any such matters may constitute a known risk for underwriting purposes.
Please be aware that a failure to disclose a known risk may affect the outcome of your client(s) claim.