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Step 8 - Getting Insured

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No one would drive a car without insurance, so it figures that no homeowner should be without insurance. The essential idea behind various forms of real estate insurance is to protect owners in the event of catastrophe. If something goes wrong, insurance can be the bargain of a lifetime.

What Kind And How Much?

There are various forms of insurance associated with home ownership, including the following major types:

Title Insurance is purchased with a one-time fee at closing and protects owners in the event that title to the property is found to be invalid. Coverage includes "lenders" coverage, which protect buyers up to the mortgage value of the property, and "owners" coverage, which protects owners up to the purchase price.

Homeowners' Insurance provides fire, theft and liability coverage. These policies are required by lenders and often cover a surprising number of items, including in some cases such property as wedding rings, furniture and home office equipment.

Flood Insurance is generally required in high-risk flood-prone areas. This insurance is issued by the federal government and provides as much as $250,000 in coverage for a single-family home plus $100,000 for contents. Your REALTOR® can explain which locations require such coverage.

Home Warranties offer the assurance that if something goes wrong after the purchase, it can be fixed. Home warranties bought from third parties by home builders are generally designed to provide several forms of protection: workmanship for the first year, mechanical problems such as plumbing and wiring for the first two years, and structural defects for up to 10 years. Home warranties for existing homes are typically one-year service agreements purchased by sellers. In the event of a covered defect or breakdown, the warranty firm will step in and make the repair or cover its cost.

Insurance policies and warranties have limitations and individual programs have different levels of coverage, deductibles and costs. For details, speak with a REALTOR®, insurance broker or home builder.

Where To Look?

REALTORS® often provide home insurance and such policies are also available from insurance brokers. The time to obtain insurance and warranty coverage is at closing, so speak with your REALTOR® or insurance broker prior to closing. Be sure to ask about limitations, costs, deductibles, and additional forms of coverage that may be available.

Are you looking to buy or just curious? We've got you covered with an overview of the process. Contact a REALTOR® today for more details.

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Enhancing Property Ownership is brought to you by the Georgia REALTORS®. We are a non profit organization made of REALTORS® that fights for the rights of all property owners by operating under a strict Code of Ethics.




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Click the link below to find a Georgia REALTOR®. REALTORS® are members of the national, state, and local Association of REALTORS® and  follow a strict code of ethics to ensure your rights are protected.

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