There are two methods used. First there is the trenching and spraying method, which is done around the entire home, then there is the bait station method, where bait traps are set 15 or so feet apart all around your home in the ground. I personally think the bait station technique is superior because you only need to spray around your home if termites are found to be swarming. In both cases you pay for the initial treatments and pay yearly fees to keep your termite letter current. in many states this letter is mandatory to sell your home. The more important thing than the manner of treatment is making sure your policy covers all repairs that are caused by termites (many companies only offer free re-treatment or repairs up to 3000 to 5000 dollars.) Your repairs could be much higher!