Lakefront properties are beautiful, relaxing, serene, and can provide a great getaway for anyone looking to make a quick escape for the weekend. However, the process of buying and insuring a lake house differs from buying a primary home. Owners should be aware of these distinction to get the most out of their waterfront paradise.
Especially when it comes to insuring a lakefront property, prospective buyers should understand how insurance packages may differ, and the extent of requirements that may be necessary in order to fully cover the home. Many things affect exactly what coverages or plans that you may need, and often depend on the state or local ordinances in place. Doing research will help determine what exactly to expect when considering a lakefront property, and can guide you to make a proper decision. By considering some key components, those interested in buying a lake house can make their process more effective and efficient:
Getting Flood or General Hazard Coverage
Being so close to a lake, and generally more out in the wilderness, buying a lake house generally requires additional coverage. This exposure to the elements means more potential for damage to occur, and so it makes sense why insurers would charge extra to cover these properties. As Bloom, Sluggett, and Morgan point out, waterfront properties “carry water risks such as drowning, diving into shallow water from a dock or swimming raft and similar situations. Boat propellers, high speed boating, water skiing, personal watercraft, water trampolines and other water “toys” all increase the risk of injury or even death.” A lake house may require a general liability insurance policy of $1 million or more.
Prospective buyers should always compare home insurance quotes to find the right mix of policy coverage at the right premium. It’s also important to know exactly what type of coverage you may need, but more on that below.
Each State Has Different Requirements; Do the Research
Depending on where you are considering buying a lake house, there may be different rules and guidelines that govern the area. Usually, these distinctions vary based on the state that the home is bought, but may also be affected by local or county ordinances in place.
One example of these varied requirements can be seen in purchasing a lake house in Florida. Although you still need to get basic homeowners insurance and flood coverage for the home, the state also requires a hurricane deductible to be added to protect against natural disasters.
You May Need to Work with Different Insurers
This one simply depends on the insurer you’re working with, as well as the area you live in. Many home insurance companies allow you to add umbrella coverage onto your regular plan, but depending on the location of the lake house, this may not always be the case.
Similarly, not all insurers may provide the specific coverage necessary for the home, and may require working with different types of insurance companies to cover all the bases. You don’t want to find out after a seasonal storm or an unfortunate injury that gaps in your lake house insurance policy are going to leave you high and dry.
Strongly Consider Working with an Agent
With all the different requirements and guidelines that come with buying a lake house, prospective buyers should think about working with a local agent. The benefits of having someone who is in the know about the regulations, can work with insurance companies to get you the lowest premiums, and has a general knowledge of the surrounding area can pay off greatly in terms of total time and costs that are spent.
Owning a lakefront property is ideal for weekend getaways, and can also be considered a great investment for the long run. However, in order to get the most out of this purchase, prudent homebuyers should consider the added responsibilities that come with a lake house, especially when it comes to home owners insurance. By doing the research on the different types of insurance required, how to get the lowest premiums, and which insurers to work with, prospective buyers could save a lot of money and headache in the years to come.