Do we really need home owners insurance ? The answer is a resounding yes we need home owners insurance. Our home is our greatest asset, beside being the place where we live, eat, sleep … and we must have it protected against many different incidents, some of them small and some not so much. These incidents occur every day and much more frequently than we would ever imagine. Who does not know of someone who has broken the tap and has flooded the downstairs neighbor? Should this happen, and we did not have home owners insurance on our property, all expenses associated with repairing the damage to our neighbor would come out of our pocket.
What should home Owners insurance cover?
In general, any basic home insurance offers:
• Dwelling (to the home itself): Roofs, floors, installations, windows … If you have home insurance, the insurer will pay for repairs for damage caused by fire, theft, water, etc. Before signing, you need to ask what accidents or incidents are included and which not, because every company is different.
• Loss or damage to your personal belongings: covers repair or replacement of furniture and household goods. You want to be covered by the cost of replacement, in other words, what these items would cost if we had to buy them again. However, it is common for companies to insure them for the actual value, minus depreciation suffered by use. Keep in mind that there may be a limit on the amount your insurer will reimburse you
• Personal liability: covers repairs and damages that the insured has to pay others for the damage they cause (for example, if you leave a gas stove on and causes a fire). Personal liability also includes your pets! This is good news for pet owners. In case there are injuries, such compensation can be substantial, so it is advisable to take out home owners insurance with high liability coverage.
• Legal defense: covers legal expenses in case others have caused damage to our property. Includes criminal defense, landlord and tenant rights, etc. You need to ask the company and be clear about how long we will be covered to avoid misunderstandings.
How much does it cost?
According to the National Association of Insurance Commissioners, the average annual premium cost for U.S. home owners insurance is $798.00. It is important to note that premiums will vary widely. Many factors influence the cost of premiums. One obvious factor that will influence the price is how much coverage you decide to purchase. You should determine the market value of your house to help you decide how much liability protection you want to buy. Regardless of what initial price you are quoted, it is important to do a little comparison shopping.
90% of citizens have been victims at some time or another of a loss of home, leaks, theft, broken windows, etc. So we must consider home insurance as a mid-to long term investment rather than an additional expense.