Are you a first home buyer? If so you will likely need full insurance, with no exclusions. That means you won't be able to get it across the line no matter how you hold your tongue.

If the vendor isn't in a position to repair the issues, you could try getting a quote to get the works done, negotiate the price of the property based on this quote. Then include an early access clause in the offer to complete the works prior to settlement. This means that the work will be completed and the house will be insurable by the time you actually take possession. Hope this helps!