Owner Finance Insurance Question

[Michael P.]

Hello,

I am going to buy a house with Cash and sell it via Owner Financing. I am curious about the insurance. Obviously I am going to require the buyer to carry insurance.

Lets say something bad happens. A fire, a tornado, etc. Something that causes a large amount of damage to the house. Think 20k+++ in damages.

Can you make it so a large amount like this is paid to the bank(me). I fear that something bad can happen and the buyer takes the insurance check and runs. This would leave me in a horrible position basically out the expense of repairing the house. Worst case scenario the house needs to be bulldozed and I am left high and dry.

Any thoughts?