There’s no time like the present to get home insurance. Whether you’re a first-time homebuyer or you’ve been in your home for years, it’s important to have the right coverage in place. Home insurance can protect your investment and give you peace of mind in the event of a disaster.
Home insurance typically covers the structure of your home, your personal belongings, and liability in case someone is injured on your property. You can also purchase additional coverage for things like flood or earthquake damage.
If your property gets damaged for various reasons, your home insurance policy will cover or pay the expenses for you. Thus, before anything happens to your house, acquiring a home insurance is the way to go.
If you’re still unsure whether or not home insurance is a necessity, here are some reasons why buying one is the right decision.
Satisfy Your Lender
Let’s start with the most obvious. Buying home insurance is not a requirement in many states per se, but some lenders require you to buy it before you can get a mortgage from them.
Home insurance protects the lender’s investment in case the house gets damaged. In a mortgage, if you aren’t able to meet to repay, your house will be repossessed by the lender. However, that house wouldn’t be able to recoup the money if they can’t sell it because of the damages.
Also, if, for some reason, you can’t buy home insurance, your lender will supply you with a policy called forced coverage. Forced coverage is an expensive policy that protects the lender from wasting their investment.
Protect Yourself from Lawsuits
Accidents can happen to anyone and anywhere. But, of course, some accidents happen even if you’re inside the home, and sometimes, it involves your family and your guests.
A common scenario is when someone gets injured inside your house, you will be met with a lawsuit, which is, of course, a real fortune to defend against. But did you know that your home insurance can protect you from that situation?
Typical homeowner insurance will protect you from legal damages when it comes to someone other than your family getting injured in your house. Most policies provide at least $100,000 for liability insurance. Not only that, but you can also buy additional coverage for added legal protection.
Of course, this liability coverage will cover any damages and medical bills that your guest had during the accident. Sometimes, your insurance company will even provide an attorney for you if your guest decides to take things to court.
Loss of Use Protection
If your house is in an area prone to floods, hurricanes, tornadoes, or any insurance peril, then it’s all the more reason you should buy home insurance.
Loss of use protection will cover the repairs and renovations needed when your house gets destroyed by natural disasters. It covers your detached structures such as your shed, garage, and dog house. It will also pay for your damaged utilities such as water, gas, wiring, heating, and even your HVAC systems.
You can even add an insurance rider for added coverage, but what is an insurance rider? Essentially, they are add-ons that can add terms for extra coverage. For example, you can add an Accidental Death benefit in case someone dies in your house during a natural disaster.
Replace Things Inside the House
If you have been a victim of burglary and theft, you know it’s a huge pain to replace all the things that have been stolen, especially if the valuables cost a significant amount of money. However, if you have home insurance, you don’t have to fret too much, as your insurance will reimburse the money you used to replace all your lost belongings.
What’s great about it is that it doesn’t have to be inside the house because it can also replace items lost in your child’s school locker, storage unit, or even in your car. However, note that it won’t insure the car itself as it’s a different kind of insurance.
Equity Protection
For most of us, our house is the biggest investment we worked for. We have been paying off our mortgage and building our equity little by little for years, hoping we can finally pay it off. However, what if something were ever to happen to our house?
Your equity would have gone to waste since we will be paying again because of the repairs we need to do. However, with home insurance, you don’t have to worry about that; it will cover repairs and make sure that your equity wouldn’t go to waste.
Final Words
Going without home insurance is a huge gamble. That said, home insurance is more of a necessity instead of a mere additional monthly payment. With that in mind, buying home insurance should be your first priority if you want to protect your house, family, and financial well-being.