Understanding The Intricacies Of Insurance

3 Questions You Might Have About Homeowner's Insurance

Insurance might seem like a waste of money to you, as you must pay it every month whether you use it or not. If you ever need to file a claim, you will be thankful you have it, though. If you want to purchase a homeowner's insurance policy and have questions about it, you are not the only person. Everyone has questions, and here are three basic questions most people have about home insurance.

1. Why Do You Need It?

Most people need home insurance for three reasons. The first reason is for protection for belongings. A home insurance policy protects everything you own, including your house structure and personal items. Home insurance is the only insurance product you can purchase for this protection.

The second reason you need it is for liability protection against lawsuits and damages. If people visit your home and hurt themselves, they have the legal right to sue you. Your home insurance policy pays the damages in cases like these, which is vital.

The final reason you need it is for your mortgage lender's protection. When you owe money on your house to a lender, the lender will require a home insurance policy. You cannot skip purchasing one if you have a loan.

2. How Much Should Your Deductible Be?

The second question to ask is about the deductible. Every policy has a deductible, which refers to the amount of money you pay when filing a claim. You can choose a low amount or a high amount, but you should think about it before deciding. A high amount saves you money on your insurance costs, but a low amount is easier to pay when you file a claim. You can ask an agent about the cost differences if you wish.

3. What Endorsements Can You Add?

Finally, you can talk to an agent about adding endorsements. Each endorsement you add costs money but provides extra protection. An endorsement covers something that your policy does not cover. For example, you can add sewer line coverage as an endorsement. If you experience problems with your sewer line, you can file a claim to receive compensation to pay for the repair costs.

Every homeowner needs insurance, even if you do not have a loan. The good news is that you can shop around to find the best policy for your needs, and you can begin by contacting an agent today.