What is Homeowners Insurance?
For many people, the most valuable asset is their house. They frequently have tens or hundreds of thousands of dollars in equity in their home, and some homeowners have millions invested in their homes. With so much invested in their homes, few homeowners could afford to replace or rebuild their house if something happened to it. That’s why there’s homeowners insurance.
Homeowners insurance offers people who own homes protection from a variety of potential perils. Many policies’ coverages focus on insuring a home against possible risks, but these aren’t the only protections that policies offer. Policies frequently also help safeguard homeowners from certain liability lawsuits and protect homeowners’ personal possessions.
Who Should Have Home Insurance?
Most people who own a house should have home insurance. Homeowners who have a mortgage on their house are often required by their lender to maintain a minimum level of structural coverage, so the lender’s interest in the home is protected even if the house is destroyed.
Even homeowners who own their house outright, however, may still want to carry a homeowners policy. For, few people could afford to replace their home if it was destroyed.