Most people who buy a home in Norway, are offered home buyer’s insurance, through the Real Estate company. And it is usually a good idea to buy this insurance.
But what does it cover?
From the name, it may appear as if you as a home buyer are insured for all kind of problems that may arise after the home purchase. For example, if something about the home is not as you assumed it would be. Unfortunately, it is not that simple.
A lawyer’s insurance
The insurance is simply a lawyer’s insurance that gives you legal help if you discover something you think is wrong after the purchase But, if this is something you should have seen at the viewing or read about in the sales material, it is not covered by the insurance.
In other words, it must be a hidden error or deficiency or lack of essential information from the seller. This is due to the buyer’s duty to investigate, which you can read more about here.
If you submit a complaint to the buyer’s insurance company, they will first investigate whether the complaining issue is something the seller has disclosed by or if it is something you should have discovered before you bid. If the latter is the case, or probably neither a hidden error, they will tell you that there is no basis for taking the matter further with the seller. If they believe you have a case, they will take the case further against the seller. Or usually the seller’s insurance company. Most sellers have taken out home sales insurance.
And now we are at the centre of the matter:
When the seller has home seller insurance and gets legal help if there is a complaint afterwards, it will be difficult for you to be without buyer’s insurance. Then you must pursue the case, alone as a consumer, against a professional party. You must write all complaints yourself and follow up the case. It will be both time-consuming and exceedingly difficult.
That is why I advise all my clients to take out home buyer’s insurance. It is a one-off payment that is not very high – from approx. NOK 7,000 to NOK 10,000 which ensures you if problems should arise.
Many disputes in connection with the sale and purchase of property are resolved through these insurance schemes and lawyers associated with the insurance companies that offer this. It also happens that they hire other property lawyers to help them with the cases.
The process of complaining through the home buyer’s incurance company
If you make use of the home buyer’s insurance, you must contact the insurance company itself and register the complaint. You will then contact a specific lawyer at the proper time – if the case is taken further. This is long an expensive process.
The estate agents you bought the property from will have an overview of which company you should adress the complaint. First check in your purchase contract that you have taken out buyer’s insurance. It will state which company it was subscribed to, and you can contact them, or fill in a claim report online.
Having to use a lawyer in property matters, whether via the home buyer’s insurance or otherwise, is never pleasant. The best thing is to check the property so carefully before buying that you avoid problems afterwards. As you know, the best thing about insurance is avoiding the use of them.
Checking the sales material and help you to avoid complaints after the purchase is one of my main tasks as home buying consultant.
