People work hard at their jobs and even have multiple ones to achieve their dream of being a homeowner. Being a homeowner is a great investment, but it comes with its own set of responsibilities. With the amount of work and patience it took to buy your own house, you should be looking to honor the achievement and maintain this investment, especially if you want it to be a family property passed down generations. Home insurance would be the first step towards that dream, and here are some compelling reasons why you should insure your house as soon as you buy it.
What is Property Insurance?
Getting insurance, in general, aims to protect you financially following any kind of damage or loss. You basically agree to pay a certain fee to an insurance company in exchange for the guarantee of protection and compensation in case of any unexpected damage. Property insurance follows this concept, giving you protection from the loss or damage to any property such as a dwelling or car. It includes homeowners insurance, renter’s insurance, and flood insurance. When it comes to homeowner insurance, it has the main functions of repairing or replacing personal belongings in your home or exterior structures like the yard of the house itself and covering personal liability when you’re held responsible for someone else’s damages.
Why You Should Insure Your House
1. It Covers Building and Rebuilding
The main function of getting insurance for your house is to protect it from any physical damage that could occur for various reasons. Whether it’s a fire, vandalism, or a tree falling over, your home insurance would be obligated to compensate you to repair the damage. Even if it involves completely rebuilding the property, your insurance should cover at least the physical aspects like bricks and mortar.
2. It Protects Your Home Contents
Not only does home insurance cover the building and re-building of your house, but it can also cover your home’s contents. It covers your personal items in the case of burglary or theft like jewelry and laptops. It also includes items like your electronic devices, air conditioners, and any other valuable items that could be damaged or lost for any reason. Just make sure you correctly estimate the value of your home’s contents to get suitable contents insurance.
3. You’ll Have Liability Coverage
Liability coverage is one of the most important aspects of getting homeowner insurance because it protects you from any lawsuits filed by others against you. Despite its importance, many homeowners disregard it when it actually comes in handy for many probable situations. This coverage even includes pets for the instance of your dog biting a neighbor in which case your insurance company will cover their medical costs. The same goes for anyone who gets injured on your property whether it’s a kid from the neighborhood or a maintenance worker.
4. Protection From Natural Disasters
Most home insurance policies don’t cover damages from natural disasters unless you specifically ask for it to be included. If you live in an area that is prone to natural disasters like earthquakes or flooding, getting an insurance quote that can compensate you would be the smart option. These natural disasters could cause serious damage to your property and belongings even if it’s just a case of bad weather; lightning could cause electrical fires and rain or snow could result in water damage.
5. It Gives You Compensation For Losses
Another main basic function of house insurance is its ability to compensate you financially for any loss of property. You can even get your property replaced instead of getting compensated with a certain amount of money. This added benefit gives you financial security in the case of any unexpected event out of your control. Just make sure you carefully choose an insurance company that offers to replace and repair any lost or damaged items.
6. It Provides Alternative Accommodation When Needed
Insurance is all about security; therefore, you’ll be completely financially secure if your home incurs any damages. However, home insurance policies go even further with the concept, providing you with several options for alternative accommodation for you and your family while your house is being repaired or rebuilt. The coverage is called additional living expenses, and it entails covering the cost for a rental house or a hotel room along with meals, and other costs you contract while waiting for your home to be ready to move in. There would be, of course, a daily or total limit for these expenses that are determined while getting your quote.
Kinds of Homeowners Insurance
Now that you know why you should be getting home insurance, you need to look at the different types of policies to make your choice.
- The simplest policy is the HO-1 and entails covering only the structure of your house, extensions to the home, appliances, and additions such as carpeting in certain situations like fire, lightning, vandalism, explosions, and more.
- The HO-2 adds the coverage of personal items and might include liability coverage.
- The HO-3 is the most popular, and it covers your home, personal property, liability, additional living expenses, and medical payments.
- HO-4 is just another term for standard renter’s insurance protecting your property and offer liability coverage.
- The HO-5 policy is the most comprehensive option covering your home, personal items, liability, additional living expenses, and medical payments for others along with higher limits for valuable items like jewelry.
- HO-6 is a policy specially made for condo owners, and it covers everything inside the unit, personal liability, and additional living expenses.
- HO-7 is specially made for mobile homes like trailers or RVs and includes structure, personal items, liability, additional living expenses, and medical payments.
- The last type, HO-8, is the perfect policy for older homes that are more difficult to replace.
As you can see from this handy guide, insuring your home is the responsible choice. The benefits you reap from home insurance are worth the small monthly payment required in return. Just make sure your money is going to the right policy and the right company that best suits your house’s needs. There’s nothing like the peace of mind and sense of security and safety that comes with getting your house insured, knowing you won’t have to worry if anything happens to it.
