Is Homeowners Insurance Necessary?
It’s an exciting time in your life, you’re thinking about buying a new home in Colorado Springs. Whether it’s your first home or not, one thing you may be considering is homeowners insurance. But the real question is, do you even need homeowners insurance? Your home is usually one of the biggest investments you will make. When you have homeowners insurance, both you and your home will be protected. If you’re wondering if purchasing a homeowners insurance policy is right for you, the best real estate agents in Colorado Springs have put together a few things to consider.
What Does Homeowners Insurance Cover?
In general, homeowners insurance covers damage to your home caused by fire, theft and other natural disasters. In addition to protecting your home, it can also protect you from liability in the event someone is injured in your home. Homeowners insurance can cover a lot more than just your home. Here are a few other things that may be included in your coverage to keep in mind when deciding if buying a policy is right for you.
- Attached structures (such as a deck or garage) that may be damaged.
- Detached structures (such as a fence or shed) that may be damaged.
- Personal property (such as furniture and electronics) that may be damaged, lost or stolen.
- You and your family – If you or a family member are found legally responsible for damaging someone else’s property or injuring someone, coverage may help pay for related repair costs, legal fees, and medical bills.
- Guests – If a visitor is accidentally injured at your home, your policy may help pay for their resulting medical bills.
- Additional living expenses – If you cannot stay in your home after a fire or other covered risk, your coverage may help pay for a temporarily increased living cost, such as hotel bills.
It’s important to note that all coverages come with limits, or maximum amounts your policy will pay out after a covered loss. When selecting your coverage limits, be sure to take into consideration things like potential cost of rebuilding your home or replacing your belongings in the event they are destroyed by a covered loss.
Is It Required?
In some cases, it may be required for you to have homeowners insurance. If you have a mortgage, your lender may require that you have insurance on your home. Before lending, the mortgage company may ask you to provide proof that your home is not only insured but insured for the right amount. They want to be sure that your home is protected financially, should it be damaged or destroyed. If you don’t have a homeowners insurance policy, your lender is allowed to buy insurance and charge you for the cost. However, it should be noted that the policy the lender obtains may be more expensive than what you can purchase on your own and offer more limited coverage.
When Is It Not Needed?
While it may be required to have homeowners insurance when you have a mortgage, there are some cases where homeowners can forgo having insurance. When the mortgage is completely paid off and you own the house outright. Most likely, mortgage lenders require homeowners insurance. However, once you own your home, you can choose to eliminate your homeowners’ insurance. In addition, if you have money put aside for emergency cases, you could skip having insurance and pay for any damage out of pocket.
Having a homeowners insurance policy won’t prevent damage to your home or belongings, but it can help provide a financial safety net should the unexpected occur. If you need help navigating the real estate market in Colorado Springs, The Platinum Group, REALTORS can help. Contact one of our expert Colorado Springs real estate agents at 719-536-4444. We can help you find the perfect home for your family.
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6760 Corporate Drive, Ste 300
Colorado Springs, CO 80906