Why You Should Be Knowledgeable of Your Home Insurance
If there’s an investment that beats all the rest, you can call it buying a house. In other words, a home is a huge investment and it requires all the protection it can get from the owner. This is because there is always a possibility that your home could fall victim to things such as fire, vandalism, theft, and even adverse weather-related catastrophes such as storms and hurricanes. The thing is, when such things happen, you could easily be left without somewhere to call home and if you guessed right, this is where homeowner’s insurance comes in.
As a matter of fact, there are so many other things that property insurance can protect your home against. Also, there are many other scenarios where your home insurance may be required and needless to mention, property insurance covers may vary from one provider to the other. Unfortunate events do take place, and especially if you’ve kept up and cleared a substantial part of your mortgage, home insurance can help to make sure that the equity you’ve earned over the years is protected. Simply put, the importance of home insurance can never be overstated. But the big question is, why should you be knowledgeable of your home insurance? Here are 5 good reasons why you ought to.
Mortgage lenders need home insurance
In the world we live in today, times are harsh and for many people, waiting until you save up enough to buy your dream home yourself can be an uphill task, if not next to impossible. To get your desired home and live in it enough to enjoy, you will most probably need to approach a mortgage lender for financing. Well, for most lenders, one of the things that they’ll require from you is home insurance. With home insurance, your lender will be more confident that their investment is protected from risks and vulnerabilities such as loss and damage. As a matter of fact, the amount of your mortgage will typically determine the minimum amount of coverage you should have in place.
Your home’s protection from loss
This is one of the basic things that home insurance does. It protects your property from aspects such as fires, theft, and vandalism. With good coverage in place, your insurance provider can cover for the costs of repairs and replacements despite the level of damage in the event of such unfortunate occurrences. This makes it important to ensure that when buying or renewing your homeowner’s policy, you verify that it pays for damages on a replacement-cost-basis as opposed to a cash-value-basis. This will ensure that you get the most out of your coverage, which is another huge reason you should be knowledgeable of your home insurance. However, sometimes the kind or level of protection provided by the cover may vary depending on the location of your home. If your home is located in an area that is more prone to hurricanes, tornados, and tsunamis, for instance, a separate cover might be required to protect your property. This is also the case with homes that are located near streams are areas that are prone to flooding, where you would need a separate flood policy.
It may cover your personal items
We all have our own personal belongings, some of which are so dear to us. However, your home might be broken into and you end up losing such property in the hands of burglars. Also, such personal belongings could be destroyed by a fire or any other hazard that is covered by your home insurance policy. In such a case, your policy provider may provide you with reimbursement for the value of the personal items that got lost or damaged. These may include items such as furniture, home appliances, electronics, and even clothing. However, you will find that most home insurance policies will only cover a limited number of personal items in your home. This means that you would want to get a contents-only cover to ensure that the items in your home that you value most are protected. As a matter of fact, a good home contents cover may also provide you with temporary accommodation when you think of moving, and even cover your counseling sessions in case you’re involved in a catastrophic event that is insured.
Home insurance protects you from liability
We live in a world where you can almost say that the law is unfair. Well, as much as it might look so, this is not the case. Take, for instance, someone visits you in your property and they end up slipping and falling, breaking a knee or sustaining a serious injury. In many places, according to the law, it is within the rights of such a person to file a lawsuit against you, stating that the fall or injuries sustained were as a result of your negligence. Even though these may not be so common in residential property, they do happen, which is where property liability protection comes in. Depending on the policy provider you choose, and the package that you go for, home insurance can protect you from such liabilities. When purchasing or renewing your home insurance policy, it is important to seek to determine the kind of liabilities that the particular policy protects you against. It can be quite frustrating to find yourself on the wrong side of the law, especially for such incidences that could occur even without your knowledge.
Temporary post-disaster housing
As earlier hinted out, in the unfortunate event of a disaster such as flooding or a fire, your home insurance takes care of the repair and renovation costs to restore your property back to its previous condition. However, it is highly likely that your home will be unlivable after such a disaster, not forgetting that repairs and renovations can be noisy, dusty, and messy, making the home even more inhospitable. In the period before your house is renovated, your home insurance may cover the costs of your temporary accommodation, including hotel expenses such as food, housing, laundry, and storage, among others. Just so you’re not in the dark, it is important to verify with your policy provider if there are such provisions in the particular policy you purchased.
Nothing gives you peace of mind than knowing your biggest investment is well protected. However, many homeowners tend to purchase home insurance without carefully examining what is covered and what is not. The next time you go shopping for home insurance, it is important to understand it in and out, and the above pointers can serve as your guide on this.