Why Costa Rica Real Estate?
Investment Security
Insurable title/home:
Costa Rica provides home owner theft, liability and natural disaster coverage. Theft insurance applies to forcible entry. The annual premium is 1% to 2% of the sum value of the items insured, but depends upon the location and on the security of the insured grounds. It is necessary to insure all items within the premises except cash, securities and jewelry, which cannot be insured. You cannot select to insure only the high-risk items. In Costa Rica it is advisable to be insured for earthquake as well as fire, water damage and natural disaster. It is possible to insure the house, the house plus contents, or the contents alone. The cost for a comprehensive plan is roughly 0.25% of the value of the building per year. The estimated annual premium for an average household would be $200 to $300 per year. As Costa Rica is not a litigious country, this coverage is not so important for the common householder.
Title insurance is commonly sold in the United States for Costa Rican property. Title insurance is intended to protect the owner or the lender from financial loss in real property due to title defects and holes. It is pretty much universal in the United States because lending institutions require it to lend money, but it is not required in Costa Rica
Title insurance coverage can vary greatly and sometimes it can be confusing so it is important to work with an attorney. In Costa Rica, it is vitally important to have the seller of the title explain whether you have legal insurance to aid in paying the legal bills to protect the title of my property or does it pay me the full stated value of my property if I have a bad claim. If all it does is guaranteed payment of legal bills in court one can still LOOSE EVERYTHING if you loose in court. A true title guarantee in Costa Rica is really a bond of fulfillment and not an indemnification.
Tips: If the seller cannot provide you with clear cut understandable official English translation of the coverage do not buy it. Ask a qualified attorney for an explanation on the terms in all cases.
