4 Reasons Why You Need Home Insurance Today

What is Home Insurance?

Also known as homeowner's insurance, this type of property insurance provides protection against damage to your home and other property due to unexpected events such as floods, snow, etc. It also provides liability coverage for incidents caused by people, such as accidents inside the home, theft, etc.

Typically, home insurance covers four types of incidents on your property: external damage, damage or loss of personal belongings, internal damage, and personal assets, as well as injuries inside your property. When one or more of these incidents occur, you can contact your provider to fix the situation and pay a deductible out-of-pocket for the insured client.

For example, imagine your home was damaged by water from a storm. You called in a loss adjuster who told you the water damage was $10,000.

You reported this to your insurer and specified the deductible amount which was, say, $4,000 according to your policy. This means the additional cost will be $6,000 paid by your insurer. The higher you pay for the deductible, the lower your monthly payments.

Mainly, most home insurance policies have a liability limit that determines how much coverage they'll provide in case of an unfortunate event at your home. The standard limit is usually $100,000 but you can negotiate with your insurer about this.

Additionally, there are many types of home insurance so finding the right one won't be too difficult. You can even compare home insurance offers directly on their website, so all you need to do is find the one that best suits your needs.

Now that you know how home insurance typically works, let's list the reasons why you should have such coverage for your house right now.

Coverage for Damage Inside and Outside

Whether your home is 30 years old or brand new, if you have homeowner's insurance, any damage—large or small—that you can't fully cover can be reported to your insurance agency.

Property damage is often very expensive, and if you want to fix it without spending too much money, home insurance can cover more than half of the repair bill.

It Also Covers Personal Belongings

The reason it's called home insurance rather than house insurance is that it protects not only the structure itself but also everything inside the home, meaning personal items will be protected too. For example, damage to furniture, clothing, gadgets, appliances and others are included in your coverage.

Some homeowner insurance policies even provide coverage for items inside a vehicle. But don't confuse this with auto insurance, as home insurance only covers property inside the car—not the vehicle itself.

Liability Coverage

Accidents happen constantly and can occur where we least expect them, especially in our homes. This includes injuries to family members as well as guests.

With home insurance, you can pay a small deductible according to calculations and the policy will take care of everything else. Injuries can be extremely costly, especially when multiple people are involved. However, don't confuse this with health or life insurance since home insurance only covers injuries that happen inside your house.

Loss of Use Coverage

When a disaster strikes, there's a good chance your home becomes uninhabitable due to serious damage after the event. Of course, it may be habitable again once repaired, but if you can't live there during repairs, where will the money come from for temporary housing and food?

Luckily, in this situation home insurance can help. With loss of use coverage, when your home is deemed uninhabitable and requires urgent repairs, this coverage compensates for temporary hotel stays and food expenses.

Some policies even include car rental when you need it for work. But if you still want the luxury of not paying too much for your monthly premium, you can still decide to choose a deductible with your insurer.

Conclusion

Home insurance is useful if you want to be financially protected when something bad happens to your home. This is especially important if you live in an area prone to natural disasters. Therefore, with home insurance, you protect not only your house and family.