For over 20 years, the Santa Cruz Properties team has gone above and beyond for their clients, providing vacant owner-financed lots to families looking to begin their legacy. But before the construction of a home, there are a few things you must consider about the land itself.
One of the most important decisions you can make during this time is if you will be purchasing – and needing – a land insurance policy.
What is Land Insurance?
Land insurance is a liability coverage that covers claims of bodily injury or property damage should an accident occur on your vacant property and you were at fault. It is a safety net of sorts that protects you financially should someone who was harmed on your property issue a lawsuit against you.
While it won’t cover damages received to your property, it will cover legal fees if you are taken to court. There are a few takeaways you must consider before subscribing to a land insurance policy:
- It isn’t required by the law to own land insurance but it is a smart idea just in case the unthinkable happens.
- Vacant land cannot have any kind of existing structures on it.
- If someone is on your property when they shouldn’t be, if they get harmed, they could still sue you for their losses.
- If your property is financed, the lender may require you to get land insurance.
Hunting land insurance is important if it will be used for such, and if a hunter were injured on your property for any reason that finds you at fault, you could be held liable.
That being said, there are some things that land insurance won’t cover.
What Land Insurance WON’T Cover
As stated above, vacant land cannot have any kind of buildings or structures on it in order to qualify for land insurance. That means anything from dilapidated homes, sheds, farms, etc. It doesn’t matter how long it has been there, or if someone lives in it or not, the insurance company will not consider it a vacant lot and won’t cover it.
And if for any reason someone is injured in an abandoned dwelling, building, or structure that you own, land insurance won’t cover it.
If you have a vacant lot that you decided to build a dwelling on, any land insurance you had prior to construction is no longer valid and additional coverage must be purchased to cover your new home that was built.
How to Purchase a Land Insurance Policy
Your first step would be to contact your insurance company to see if they have any type of land insurance that would suit your needs.
If they don’t, there are still other potential options. You may have to seek out another specialized-coverage company that could provide it for you. A quick Google search will pull up several vacant land companies that can cater to your needs.
Do You Need Land Insurance?
As it isn’t required by law, the simple answer to this question would be no. However, for peace of mind—especially if your owner-financed lot is near a high foot traffic area—it should be recommended that you purchase one to protect your finances should an accident occur on your vacant property.
Find the owner-financed lot of your dreams with Santa Cruz Properties.
While being in the owner-financing lot business for over 20 years, we have picked up on quite a few good tips and are always happy to relay them to our clients. In short, land insurance is a great idea to protect yourself and your vacant lot from hefty damages that would otherwise come out of your pocket.