Many people who choose not to have insurance realize how helpful it would be to have it when they need it. Going without home insurance is a big gamble because the money you saved by not getting it might not be enough to cover whatever you need it to. To help you understand why home insurance is so important, we will look at a few reasons why you should not neglect or ignore it.
You Might Have a Hard Time Getting a Mortgage or Other Loan
While homeowner’s insurance is not strictly required, many banks and lenders insist you have it if you would like to take out a mortgage or other type of loan on the home. Why? They need to know their investment is protected in case something happens to the house while you still owe money.
Lenders will typically ask you to get insurance that can cover the amount of the mortgage or loan even when factoring in the value of the home. In some cases, the lender will supply forced coverage. Do not accept this because it is typically more expensive than normal homeowner’s insurance. Additionally, these types of coverage only protect the lender’s interest and not yours, you, your family, or your property.
You Forfeit Discounts on Other Types of Insurance
Many insurance providers will give you a discount on another type of insurance, typically auto insurance. You are legally required to have auto insurance before you drive. Even though you pay more for a combined policy, you end up paying a lot less if you have a homeowner’s and auto insurance bundle.
You can also miss out on other discounts such as additional fire protection. You can explore other options when it comes to homeowner’s insurance discounts to see other areas where you can save money. As it turns out, these homeowners insurance discounts will help you save money on insurance you would have got anyway.
Homeowner’s Insurance Protects You from Loss
Your homeowner’s insurance should cover damage from natural calamities and some man-made events. These include tornadoes, hurricanes, fires, and other types of events. The one event that is not typically covered, and that you need extra insurance for, is flooding.
You will be required to pay out-of-pocket if you do not have coverage, which might end up being too expensive for you. When getting homeowner’s insurance, you need to ensure it covers both the home and your belongings.
You Will Not Be Protected from Liability
Accidents can happen at any time, and these include if someone is injured while at your home. If this happens, you might be held liable for their injuries, and you would have to pay their medical expenses. This can happen even in cases where you had nothing to do with the injury.
In these cases, the insurance will have an upper limit for how much they can pay, and this amount is usually a lot more than most people can pay in an instant.
Homeowner’s insurance is incredibly useful in protecting you from paying for damage to the home, loss of property, and liability in case someone is injured in your home. All the reasons discussed above combined are why you should get it as soon as possible.