Commonly referred to as HOI in some jurisdictions, home insurance is one type of property insurance. Its policy is specially designed to cover private residences; the building, its content and loss of use. It is common to find home insurance policies incorporating liability insurance that covers a homeowner in case of any accident one may suffer while in a home.
Home insurance is usually a term insurance contract that remains in force for a fixed period of time. The contract is between you and a property insurance company that sells you the policy. It is a legally binding contract where you are obligated to pay a premium as stipulated in the policy document. The cost of premium varies depending on several factors including any additional riders you choose.
There are 5 reasons why you need home insurance:
Indemnity – This is One of the important reasons why you need home insurance is the fact that your insurance company indemnifies you in case of damage to your house or loss of use that can be brought about by several factors. Your insurance company only indemnifies you so long as you are up-to-date on your premium payment.
Peace of mind – This is one of the top 5 reasons why you need home insurance. With ever increasing crime where home breakage, theft and vandalism are common, being away from home without knowledge of what happens at home can be very agonizing. Having home insurance cover saves you from such agony knowing that your home is protected and that you will receive compensation in case of any incident.
Increased value – Apart from any improvements you may add in your home that increase its value, buying home insurance further increases the value of your home. Rental income that you can receive when you rent it out for one reason or another can be very attractive.
Loan – This is one of the most important 5 reasons why you need home insurance. Renovating and giving your home a facelift can be very expensive at times. Luckily, having insurance for your home puts you in a good position to access cheap loan from your insurance company, a loan that can go a long way in meeting renovation costs.
Protection – Although related to having peace of mind, you cannot ignore the protection that home insurance provides. Constructing or buying a home is an investment that you need to protect at all costs.
Contrary to common belief, the cost of home insurance is not high. The number of property insurance companies is not only high; they are in fierce competition for clients like you. This gives you the opportunity to shop both locally and online for accompany whose premium rate is not only low; the policy also provides the specific cover that you need.