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Leaving your home unprotected in the event of fire, storm damage or theft can be a costly mistake. While there are no laws requiring you to have homeownerโs insurance, itโs still a good idea to have your home covered. If you have a mortgage, you most likely cannot go without it as most lenders require it. While increased insurance costs can cause some homeowners to consider dropping their coverage, even if you are independently wealthy itโs probably not a good plan. Here are a few questions to ask if youโre considering going without homeownerโs insurance.
1. Do I have the funds to replace my homeโs contents or make repairs if disaster strikes?
You never know when a storm will hit and do thousands of dollars in damage to your home. Should a fire break out, would you have the funds to make repairs and properly clean your home after? If someone breaks into your home, do you have the funds to replace all your electronics and jewelry they will most likely steal? Sometimes the value of a homeโs contents is grossly under-valued and it would be a shame to have to fund the replacement of those items out of pocket.
2. Do I value my home and contents enough to cover them?
If you really donโt have an attachment to your contents and would not care if they were destroyed or stolen, you may consider going without homeownerโs insurance. But you have to think about the future. You may decide you want to have insurance again but cancelling or going without could cause you difficulty when applying again.
3. Do I have the funds to pay for injuries sustained by guests in my home?
If someone injures themselves at your home, you are liable for their medical bills. Can you afford to pay for someoneโs hospital stay? Or even their ride in the ambulance? Having a homeownerโs policy will keep you from paying for these types of situations. It is not recommended to go without homeownerโs insurance. As you can see, it can be dangerous to your finances.
Make the pain end!
On average, there are very people who can, and even fewer that should go without homeowners insurance. The shorter that lapse, the more claims detail given to your broker and documentable mitigation of risks, those are the best ways. Finding an agent that specializes in high risk homeowners insurance is almost always the best option.
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