Is Home Insurance Mandatory For a Home Loan?

Your home is not just the building or the physical property itself. Your home is made up of your family, your feelings, aspirations, dreams and hopes. Yes, that is what makes a home, not just bricks, cement, etc.

Now imagine losing your home all of a sudden. That’d spell huge emotional and financial setbacks surely. After all, most of us don’t sit on enormous piles of money to buy new homes just like that. Buying a home is one of the most important decisions and times of one’s life. That’s why losing it for any reason hurts so much.

However, there is one thing you can do to ensure that a setback like this won’t destroy your finances, and that you can still get a home easily. For this, you need to insure your property. This is just like insuring your car. If your car gets damaged, you can get your insurance money to get another car or to repair the one you got. Insuring your home is just like that. For instance, if your home gets damaged or destroyed completely, you can get it repaired or can buy a new one from your insurance money.

Here are 5 reasons to go for a home insurance:

Natural disasters

Let’s face it. The real estate boom is all fantastic, but it also means many properties are not being built according to plan, or properly. Earthquakes are the cause of the total destruction to homes more than anything. If you have your property insured though, you won’t have to worry about much except to get out of harm’s way. As you can see, it gives you a great peace of mind. Properties can also fall prey to cyclones, tsunamis, tornados, hurricanes, and fire. However, remember that floods are not covered by this insurance type, and you need to take separate insurance for earthquakes.

Protect your property from theft and robbery

You may think that since you live in metro cities, your home will never be robbed, or that there shall never be theft. But if you have been seeing the news, these cases are on the rise. If you have home insurance, the insurance company shall reimburse you for all damages and stolen items. To make sure the reimbursement process goes smoothly, you need to keep a list of all costly items you keep at home. Thus, if anything is stolen, companies can’t deny you the money. 

Paying medical bills

You can be held responsible if anyone has an accident within your property. To make sure you won’t face difficulties, you need home insurance as it protects you from these instances. For anyone injured within your property, the insurance shall give the person’s medical bills. 

You get peace of mind

When you have home insurance, you don’t have to worry about anything untoward happening to your home or property. If anything happens, the insurance company shall take care of it.

Mortgage lenders shall be satisfied

Some lenders and banks need you to have your home insured since it protects their investments against various risks. Thus, depending on the mortgage amount, you need to pay an amount for your home coverage insurance.

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