When does the property become my risk in Queensland?
Under the standard REIQ contract the property is at the buyer's risk from 5pm on the first business day after the contract date, not at settlement. This is a critical difference from some other states: risk shifts to you almost immediately after signing. The seller must take reasonable care of the property until settlement, but that does not remove your exposure once risk has passed.
How does Queensland compare with NSW and Victoria?
Queensland is the outlier. In New South Wales and Victoria the property stays at the vendor's risk until settlement, so you have far longer before the exposure is yours. If you take early possession, risk shifts to you at that point in every state.
| State | When risk passes to the buyer | Who bears it until then |
|---|---|---|
| QLD | 5pm on the first business day after the contract date | You, almost immediately, so insure on signing |
| NSW | On settlement, or earlier if you take possession first (Conveyancing Act 1919 s 66K) | The vendor |
| VIC | On settlement, or earlier if you take possession first | The vendor |
Buying interstate? See the companion guides on property condition, risk and insurance in NSW and the same in Victoria.
What happens if the property is damaged before settlement?
If the property is damaged between the contract date and settlement, for example by fire or vandalism, you must still settle unless the property becomes unfit for occupation. Because risk sits with you from the first business day after contract, an uninsured buyer could be left completing the purchase of a damaged property. This matters even more when there is no cooling-off period, such as when buying at auction in Queensland.
Can I claim on the seller's insurance if I don't have my own?
Possibly, but don't count on it. Under section 50 of the Insurance Contracts Act 1984 (Cth), once risk has passed to you, you can be treated as an insured under the seller's building policy for loss or damage occurring between the day risk passes and the earliest of settlement, the day you take possession, or the day your own cover starts. In Queensland, because risk passes so early, that window opens almost straight away. The catch is that this only helps if the seller actually holds a current, adequate policy. The seller may have cancelled it, may be underinsured, or the loss may fall outside what the policy covers, and you have no control over any of that. Treat section 50 as a backstop, not a plan: take out your own cover from day one.
What insurance should I arrange, and when?
Do not rely on the seller's insurance. Arrange cover for the home or building and contents (which typically includes legal liability — check the policy) immediately on entering into a contract, so it is in place before the property is at your risk. A seller should keep their own insurance until settlement is confirmed, but that protects the seller, not you, so it is not a substitute for arranging your own cover.
I'm buying an apartment or townhouse. Who insures the building?
It depends on how the scheme is surveyed. For an apartment on a building format plan, the survey used for most unit blocks where lots are defined by the building's floors, walls and ceilings, the body corporate must insure each building that contains a lot for its full replacement value, along with common property, shared assets and public liability for the common areas. Lot owners share that cost based on lot entitlements — building and common-property insurance by the interest schedule, and public risk by the contribution schedule. So you do not need standalone building cover: you need contents insurance and public liability for the inside of your lot.
For a standard format plan, where lots are defined by land boundaries, as with many townhouses and villas, it comes down to the buildings. The body corporate insures structures that share a common wall, while a freestanding building is usually the lot owner's own responsibility to insure. Check the body corporate disclosure statement and its insurance so you know exactly which side of that line your lot falls on.
Risk and insurance at a glance (QLD)
| Property type / scenario | When risk passes to you | Who insures the building | What to do |
|---|---|---|---|
| Standalone house | 5pm on the first business day after the contract date | You (the buyer) | Arrange building and contents cover (typically including legal liability) as soon as you sign |
| Apartment (building format plan) | 5pm on the first business day after the contract date | The body corporate (each building, at full replacement value) | Take out contents and interior public liability cover |
| Townhouse / villa (standard format plan, no common wall) | 5pm on the first business day after the contract date | You (the lot owner), for a freestanding building | Check the body corporate disclosure; take out your own building cover |
| Property becomes unfit for occupation before settlement | The exception | — | You may be able to end the contract rather than being forced to settle |
Property condition risk is one part of your pre-settlement checks. It sits alongside confirming smoke alarm compliance and reviewing any easements on the title before you commit.
General information only — not legal advice. Confirm your situation and the exact contract terms with a licensed conveyancer or solicitor.
