Why do we need homeowners insurance?
Buying homeowners insurance is like buying car insurance:
you want and need extra protection for your property if it is damaged or someone is injured on the property. As car insurance, the type of home insurance that you buy in large part determine what you pay. It's a worthwhile investment and in many cases, required if you live in areas prone to natural disasters such as floods, hurricanes, wildfires and earthquakes zones.
In general, owners will buy two types of home insurance:
insurance risks and liability insurance. Risk insurance protects your home from accidental damage or destruction. This includes covering the costs of repairs and lost contents vandalism, storms and fires. However, keep in mind the risk of insurance, the insurance company will refund the original price paid for a lost object. For example, if you paid $ 500 for a dining table that was purchased 10 years ago, your insurance company will not pay $ 500. Instead, they will pay the amortized cost of the dinner table.
Home insurance also includes liability. This covers the costs of all injuries that occurred on your property. For example, if a friend or relative accidentally trips on a hose and turn the ankle, you can use liability insurance to pay for medical damages incurred to limited in the policy.One of the main reasons that owners also buy home insurance is that your mortgage company requires. In other words, until you pay the mortgage, the lender owns part of the house. Your lender wants protection while the house is security and require the purchase of at least a minimum level of insurance risk.Note that the basic home insurance does not cover everything. If you have expensive office equipment or save money at home, these items are not covered under any type of property insurance. Office equipment can be provided, but you will pay more for the addition of a complementary policy. In addition, basic home insurance only covers certain types of natural disasters.In flood and earthquake prone areas like Louisiana and California, homeowners insurance does not automatically cover these natural disasters. Instead, you need to purchase additional coverage for floods and earthquakes. Also, if you live in an old house or the owner of an old building is severely damaged, the new reconstruction must follow the building code standards. Your insurance company, however, is not obligated to pay for all the new changes. It is important to have a broker who has experience and a wide range of businesses to provide enough quotes to make the best choice.
