I'm not an insurance expert, just a simple homeowner who has lived in a variety of areas and homes, and someone who helps buyers and sellers buy and sell. So check with an insurance expert if you have some specific questions about your situation and area. But here are some general thoughts to consider, based on my knowledge and experience, some of which are more specific to my area:
BUYERS
Check on the insurability of the home you are buying early on in the due diligence period to make sure you can get coverage. While this is likely not a problem for most homes, there are insurers who will no longer insure certain kinds of property, or if a home has had excessive claims, or the rate may be very high because of certain risks. In particular this may occur with homes:
- In high risk fire areas or areas where fires have recently occurred (e.g., Inland San Diego County)
- Directly on the water or on ocean bluffs (e.g., Carlsbad, Encinitas, Solana Beach, Del Mar, Oceanside, La Jolla)
- In areas of landslide risk and/or past activity (e.g., Mt. Soledad area of La Jolla)
Proof of insurance (paid for 1 year) will likely be required at the time of closing by your lender for a detached home. Even if you are a cash buyer, you should certainly obtain it too.
For condos, proof of the Master Insurance Policy through the HOA will be necessary, and more and more lenders are requiring other insurance (e.g., "studs in") on condos, from the word on the street. Be sure to ask your lender during the transaction so you will be able to close.
To the best of my knowledge earthquake insurance is NOT part of standard policies and must be purchased separately. Know that it can be expensive, and many folks opt to not buy it and take the risk. Hmmm. If the home you are buying is in a higher risk zone (based on the Natural Hazards Disclosure Report) give this some serious thought and investigation.
SELLERS
Check on your insurance when you remodel, especially if extensively (e.g., adding square footage), or add a pool or spa or other structures.
Periodically check on your insurance including comparison shopping on rates. Make sure those valuables (art, jewelry) and expensive toys you buy are covered, or get them on a rider.
Know that you may be required to maintain the same insurance coverage on your home for the duration of your sales contract - check to see what it says specifically
If you vacate your home (e.g., move to a new home, relocate) check on your insurance coverage. Homes may not be insured by your provider if the home is vacant, and a different policy may be needed
Again, it's smart to talk with the insurance experts to make sure you are not under-insured.
And do some comparison shopping.
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If I can provide more information about Carlsbad real estate and surrounding areas, or the housing market in general, or otherwise assist you in your homes search, please contact me by phone or text at (760) 840-1360 or email me at JDowler@remax.net.
All content copyright © 2009 Jeff Dowler "The California Relocation Dude" Carlsbad Homes and Real Estate Tidbits
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If I can provide more information about Carlsbad homes and real estate for sale and surrounding areas, the housing market in general (or locally), or otherwise assist you, friends or family in a home search or sale, please contact my mobile office or text me at (760) 840-1360 or email me at JeffDowlerSolutions@gmail.com
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