If you are buying a new home or have owned your home for a while, you have probably heard about how important it is to have home insurance. It is true that you should insure your home before it is too late in any situation. The average price of a new home in the year 2015 was almost $300,000, meaning that for many people, their home is their most valuable asset. Because of all of the money wrapped up in this asset, it is a smart decision to protect this investment with insurance.
Homeowners Insurance Could Be Required
If you are paying a mortgage, most lenders in this situation will require that you have homeowners insurance. In fact, before a mortgage or refinancing of the house is funded, the company will often ask you for proof of protection of your home. They want to make sure that your home will be projected in the cases of damage, such as fire. There are things that you can do to protect your home from a disaster such as a fire. For example, some security systems have monitoring that includes smoke alarms or even flood sensors.
It is always smart to have a smoke alarm that can help prevent a fire that destroys your home. It can also be extremely beneficial to have a security system, just in case anyone decides to break in. However, as is the fact with the smoke alarm, the security system will not be 100% foolproof and will not necessarily protect your home and belongings in every single case. Because prevention is not always an option, it is the smart choice to have homeowners insurance whether or not you have a smoke alarm and security system.
Protection for Other Assets
Often, homeowners insurance does not exclusively cover the home. It can also include attached structures, such as a garage or deck. Additionally, it is possible that homeowners insurance will cover physical belongings that are inside of the home and other structures, such as a shed in the backyard. In some cases, medical bills will be included if a guest happens to be injured on your property.
As you can see, it is imperative to make sure that your home is covered in case of some unexpected disaster that ends up costing you money. Many people believe that it is not going to happen to them and avoid paying insurance for that reason, but then they end up regretting it when they end up the victim of one of these unexpected events.
Sources
Alliance Insurance Agency
Protect Your Home
NerdWallet