Why should I buy homeowner’s insurance?

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Asked April 12, 2015

1 Answer


The first reason to have homeowners insurance is that your mortgage company requires it. They make this requirement a part of your mortgage contract in order to protect their investment. Without coverage, a house fire could leave you without a home and mortgage without their investment. You would still be liable for the cost of the home, but the lender's only recourse would be to take you to civil court to get their investment back.

Unless you are a wealthy person, trying to replace the things lost in disaster could bankrupt you or leave your family without their possessions. Comparing the cost of homeowners insurance with the cost of replacing all of your personal property makes it obvious that insurance is the most affordable way to go, even if you pay for coverage for many years before you ever file a claim.

A similar situation would be if you had to stay in a motel while your kitchen is rebuilt after a small fire. With a homeowner’s policy, you would be able to claim the costs of any loss of use of the property, from a place to sleep or eat to things like washing your laundry. Without insurance, these incidental costs would be your personal problem, and the expenses could mount very quickly.

If a visitor to your house trips over a loose paving stone and gets hurt, you are liable for their injuries. With a home insurance policy, most of those costs would be paid by the insurer, even the legal fees that could arise if the injured person sues you. Without homeowners insurance, you would have to pay those costs out of pocket, which could be a financially impossible task.

If a tree on your property is blown over by high winds, damaging your neighbor's house or other property, a homeowner’s policy would pay for the damages. As with bodily injury, you are responsible for the damage your tree causes, even if it means building a new home for that neighbor you never got along with.

Answered April 15, 2015 by Anonymous

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