homeowner’s insurance

Homeowner’s insurance does pretty much what it sounds like – it insures your home against damage or loss.  If there’s a hail storm or fire, or a thief breaks in and steals your valuables (note to thieves: there are no valuables in my house), the insurance company will pay for repairs or replacements.

Another valuable benefit the insurance provides is temporary housing.  If you have to leave your home for a while so that repairs can be made, the insurance will pay for you to live somewhere else.  This can be especially helpful if, like me, you can only afford one housing payment.

One gaping hole in homeowner’s insurance is the lack of flood coverage.  If you have a homeowner’s policy, but no flood insurance, you’re out of luck when Noah comes through.  Flood insurance is easy to get, however.  Flood insurance is provided by the federal government, so all carriers have the same price for coverage.  This means flood insurance obtained through your current homeowner’s carrier is just as good as anybody else’s, and you won’t have to shop around for the best deal.

But not everybody owns a home.  What about those who rent?  Renter’s insurance is also available, and generally any carrier that offers homeowner’s insurance will also offer renter’s insurance.  And the good news for renters is that renter’s insurance is usually a lot cheaper than homeowner’s insurance.  Since renter’s insurance only covers the renter’s possessions, and not the home itself, the carrier can give steep discounts to renters.  You may think that you don’t have anything valuable enough to insure, but remember that renter’s insurance will also pay for temporary housing if you have to move while the landlord makes repairs.

If you have a mortgage on your home, your mortgage company probably requires that you have homeowner’s insurance.  If you own your home free and clear, there’s no rule that says you have to have homeowner’s insurance, but you’d be pretty silly not to have basic coverage.  If you rent a home, your landlord can’t require you to have renter’s insurance, but coverage is so cheap, and the benefits so great, that you really ought to have it anyway.

This article originally appeared in the September 17, 2008, edition of the Greenhorn Valley View.

One Response to homeowner’s insurance

  1. I’m currently renting and was on the hook on whether I should buy renters insurance or not. Wanting to thank you for this post. I’m going to check in with it tomorrow to see what my rate will be. If it is affordable as you say then I will get it because of all my expensive things I have. Thanks for the information.

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