Even When Homeowners Insurance Is Optional, It Is A Necessity
Owning a new home is an accomplishment, but it is also quite expensive. Not only do homeowners look at every single opportunity they can to save money, but they may also make some very risky moves just in an effort to save a small amount of money. There are some exceptions in which homeowners are able to go without homeowners insurance coverage, but the savings that they experience as a result can lead to them losing the entire value of their homes.
When Homeowners Let Insurance Coverage Lapse
Homeowners insurance premiums can be included in their mortgage payments, be paid on a monthly, quarterly, or even yearly payment schedule. When you go without paying your homeowners insurance for a period of time, your coverage will ultimately lapse. Without homeowners insurance, you will need to pay out of pocket for any disaster, theft, or damage that occurs to your home.
Allowing your homeowners insurance coverage to lapse can also put you at risk with your mortgage company. In the US, there are no home mortgage companies that will extend loans to homeowners without the right home insurance coverage. On the other hand, homeowners who have paid for their houses, condos, or mobile homes in full are able to go without coverage so long as they are not violating any local ordinances or rules.
Mobile Homes and Homeowners Insurance Coverage
If you own a mobile home and you are not making payments on it, there's a fairly good chance that you aren't required to purchase homeowners insurance coverage. Unfortunately, mobile homes can be wiped out in the event of fire. Mobile homes are also generally easier to break into, while flood damage can render a mobile home entirely uninhabitable.
Inheritances and Private Home Sales
When a home is left to loved ones in a will, normally the recipient is responsible for acquiring his or her own homeowners insurance coverage. The same is applicable when a house is sold privately between two parties. While you may not need to purchase a homeowners insurance policy for a piece of property that is fully paid off, consider what you have at risk. A home is only valuable if it can be sold or occupied. When a house becomes damaged by fire, wind, theft, vandalism, or even botched home repairs, its owners have to think about how much money they need to invest to get it back to its original value. Homeowners insurance coverage may be an expense that you will always need to factor into your budget, but it can also assure you that your property will always retain tangible value.
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