The National Directory of Certified Public Accountants

Ask A CPA - Mortgages & Loans

What Is Hazard Insurance ?

Hazard insurance protects homeowners against property damage caused by natural disasters such as a fire or severe storm. If your property is damaged during a catastrophe, hazard insurance should cover the costs to rebuild your home. Banks and lenders require that you get a hazard insurance policy before you buy or refinance a home. Generally, you have to pay for the first year of hazard insurance on the closing date.

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