Why is it necessary for expat retirees to insure their home?

Buying a home is one of the largest investments you make during your lifetime. Some expats who relocate to Costa Rica choose to become homeowners. Those who are among this group should definitely have full insurance coverage to protect their investment. Let’s see why this so important.

Getting over the loss of home because it wasn’t insured is a tough pill to swallow for anyone not to mention a retired person. When confronted with a disaster like an earthquake, flood or fire it is vital to have an insurance policy to minimize the loss and, above all, to recover financially. Needless to say, A retiree on a fixed income would have a more difficult time recovering from the loss of a home.

By law it is not necessary to have a home owners insurance policy in Costa Rica. However, if you have mortgage it is required. In reality any home owner in Costa Rica would be crazy not to have full coverage on their home.

The cost of insurance varies according to the type of policy and the home’s features. A basic policy only covers a certain percentage of the value of a property. There are also special policies which cover residences located in areas that are prone to disasters. For example, those found near volcanos, zones subject to landslides places that tend to flood.

In general a regular home owners policy covers: fire, lightening strikes, earthquakes, landslides, volcanic eruptions and falling objects like trees.

In addition to a policy that covers the structure it is important to have a separate coverage for furniture, appliances, computers and works of art. In Costa Rica these items are not covered under a standard insurance policy. A list with detailed descriptions and photos of these items must be submitted to the insurer in order for the policy to go into effect. Remember, it is the homeowners responsibility to declare the value of these items and update the list annually when the policy is renewed.

By the way, automobile and medical polices are separate.

I suggest that you use the insurance company authorized by the Association of Residents of Costa Rica ARCR. For more information see: http://www.arcr.net/services1/insurance-in-costa-rica/