What Is Homeowners Insurance?
Homeowners insurance is protection for your home that helps cover repairs or replacements to your home’s structure, belongings and even covers you if you’re liable for injury to another person when they’re on your property or accidental damage to their property. For example, if your home is damaged by a fire, your policy would likely cover the cost of the repairs (once you’ve met your deductible).
A standard home insurance policy includes essential coverages that offer protection from a specific set of common damages. Just as every home is unique, so is every home insurance policy. And you’ll have the option to customize and purchase additional coverages as they fit your needs.
Why Do You Need Home Insurance?
Simply put, your home is a major investment that should be protected. Unexpected damages and losses can happen, and if you’re insured, your financial responsibility is limited — the amount you owe won’t exceed a certain set amount (your deductible) up to a certain total (your coverage limit). If you don’t have coverage, you’ll likely be on the hook for the total cost of the damages.
So why not pay a little now to avoid the possibility of paying a lot more later? Also, while home insurance isn’t typically legally required, it is likely required by your mortgage company or bank.