What type of mortgage covenant often includes the obligation to maintain insurance on the property?

The correct answer is the property maintenance covenant, as this type of mortgage covenant explicitly outlines the borrower's responsibilities regarding the upkeep of the property, which includes maintaining adequate insurance coverage. This requirement ensures that the lender's investment is protected against risks that could lead to financial loss, such as damage or destruction of the property.

Property maintenance covenants often stipulate that the homeowner must carry a certain level of insurance, which may cover various potential hazards, such as fire or natural disasters. By having this obligation, the lender can mitigate the risk of loss and ensure that the property retains its value throughout the duration of the mortgage.

Other options, while related to the mortgage process, do not specifically require maintaining insurance on the property. An indemnity clause generally relates to compensation for losses or damages but does not specifically mandate insurance coverage. An escrow agreement typically involves holding funds for property taxes or insurance premiums but does not encompass a direct obligation to maintain insurance. A due-on-sale clause allows the lender to call the loan due if the property is sold but does not address the insurance maintenance requirement.