If you are having a home built, your insurance needs are slightly different from someone purchasing an existing home. Even though you do not actually take possession of the home until the closing, you still want to protect your investment. The builder carries limited protection. In some cases, additional protection is needed to protect you and the property. Aside from homeowners insurance, you may also want to protect your ownership rights by purchasing title insurance.

Liability During Construction

Your insurance coverage needs vary, depending on who actually owns the land during construction. If you hired a general contractor to build the house and handle the process, the contractor owns the land. Since nothing is in your name, liability falls entirely on the contractor if something were to happen to the home or on the land. On the other hand, if you own the land and hire a contractor to build the house, you need liability coverage to protect your assets in the event someone is injured on the property. If someone is injured on the property while the house is under construction, the contractor and homeowner can both be sued. The contractor's insurance policy will not protect you, unless you are specifically added to the policy.

Insurance Options

A standard homeowners insurance policy covers damage to the home and theft. The policy will also provide you with liability coverage, protecting you from a lawsuit. Since the home is not finished, none of your personal property is covered. Content cannot be insured until the home is secure or lockable. Another option is to purchase a dwelling and fire policy for the protection of the physical structure only. Despite the name, dwelling and fire coverage is not limited to just fires. Additional hazards are covered, such as explosions, vandalism and wind damage. Liability coverage is provided, but theft protection is not.

Insurance After Construction

After the home is built, reevaluate your coverage needs. If you purchased a limited policy during construction, you will need a full homeowners insurance policy after building is complete. You need to insure your contents and dwelling if you plan to occupy the home. If the home is a rental property, you will need a landlord insurance policy. You are not insuring the contents, but your rates are not necessarily lower than a standard homeowners insurance policy. Non-owner occupied properties generally require greater liability coverage.

Title Insurance

When buying a newly built home, title insurance may not seem necessary. Although a brand new home has no previous owners, the unimproved land may have had prior owners. A title search reveals any existing liens on the land. Title insurance also protects against potential contractor liens from a builder who may have failed to pay his suppliers or subcontractors. To ensure a clear title, lenders require buyers to purchase a Loan Policy of Title Insurance. The Loan Policy only protects the lender's interest. You can protect yourself from overlooked title threats by purchasing an Owner's Policy of Title Insurance.

Contact The Burrows Agency for more Information. 

Our Agency Staff has 70 years combined experience and we can write business with over 50 different Insurance Companies & Brokerage Firms. The Burrows Agency is also part of the Centre Group, a cluster of agencies across the State of Oklahoma, which provides us with a broader range of Insurance Markets for our customers.  We have been taking care of peoples insurance needs in Rogers County and across the State for 50+ years. 

Our Agency has the experience, professionalism, and knowledge to take care of your Personal & Business Insurance needs.