At what point do you run out of moral high ground?

You are at no financial, moral, or legal risk if you handle the transaction properly. 

@Josh Prince I suppose the moral of the story is just not to buy based on the pro-forma or market rent, but only what is currently being paid in rent. 

As long as I stick to my morals and can sleep at night business is business.

This is a practice that shows an incredible weakness of moral character.

When I see someone express a 'ethical or moral' argument, the people that do not agree stand on the law- like if it is not legal it is ok.

(and morally too!)

Ultimately people have different moral views, but I look at it as a business decision.

And insurance companies there typically have very poor claims-paying habits so we don't expect anything from them.The OP might find it easy to fit in India if he thinks that violation of contractual obligations is morally right.

***Warning, long post with views you'll probably not agree with***Obviously this is a moral problem.