What is the importance of home insurance?
Is it necessary? Does it really pay off? These are among the many questions that might go through your mind as a homeowner or renter. In addition to property taxes, mortgage and other monthly bills, buying home insurance, which is not even a requirement of law, might seem to an overwhelming majority as a waste of money. This however could not be further from the truth.
Home insurance is vital. It covers your home in case of accidents, fires, floods, theft and any form of structural damage. Without a home insurance cover, you could easily lose everything in your home that you care about from your furniture to your antiques. Here are some reasons why home insurance is critically important.
Liability protection is included in home insurance. This means that if an accident happens to within your insured home, the insurance company pays for the medical bills. Damage to other people’s property is also covered for example if a tree in your home falls on other people’s property, the insurance company is the one to compensate them.
Peace of mind
The fear of the unknown in addition to the financial woes caused by the failing economy can drive you crazy. You might think that home insurance is an additional cost that is unhealthy to your already stretched out budget but considering the peace of mind it buys you, it is worth every single penny. You cannot put a price on peace of mind. When you have home insurance cover, you can always rest easy knowing that your future is secured in case a catastrophe strikes.
Access to mortgages
If you want to fund or refinance your mortgage, lenders will want to see that your home is insured to make sure their financial stakes are secured. If your house is not insured, most lenders will buy the home insurance and add the cost of the monthly premiums to your mortgage payment. Others will just cancel the deal all together. Before approaching any lender for a mortgage, ensure you first get a home insurance policy that works for you.
Your home might be one of the largest and most important investments you will ever make. You could argue that it is in a safe location not prone to home invasions or natural disasters but this can turn out to be a very costly gamble when your home is destroyed without notice. This might cause you and your family untold emotional torment and financial loss from which you may never recover. The -importance of home insurance cannot be underestimated. It is always better to be safe than sorry.