THE ADVANTAGES AND DISADVANTAGES OF HAVING RESIDENTIAL PROPERTY INSURED
Insurance is something that we need to protect ourselves against unexpected events. This is why we need to make sure that we are covered against any potential loss or damage. There are many different types of insurance policies available, and they vary greatly depending on what you are insuring.
In this blog post, we will discuss some of the pros and cons of having a residential property insurance policy.
THE ADVANTAGES AND DISADVANTAGES OF HAVING RESIDENTIAL PROPERTY INSURANCE
When looking into residential insurance policies, you will find that they offer protection against many different things. There is usually a choice of different cover options, so you can select what you need. There are also different levels of cover that you can select from, so you can be sure that you are getting what you need.
However, it is important to understand what is included in your policy before you select the right one for you. This will ensure that there are no surprises if the worst happens and you need to make a claim. Sometimes, it can seem a little daunting trying to find the right policy for you.
However, this shouldn’t put you off; you should always do your research before you buy your insurance, so you know that you are getting the best deal. There are many advantages and disadvantages to having a residential property insurance policy.
Here are some of the main ones:
- Covers significant damage to your home: Some policies will cover you for damage such as flooding and subsidence caused by outside factors.
- Low deductible relative to repair cost: most insurers will not require you to pay anything towards the cost of repairs until you have made a certain number of claims or your property has suffered significant damages.
- Protection from lawsuits: If your property is damaged by an uninsured person or company and they decide to sue you for damages, your insurer may be able to cover the costs for you.
- Doesn’t cover everything: While most policies will cover damage to your home caused by theft and natural catastrophes, there are some things that this sort of insurance completely excludes from cover.
- There could be several unstated expenses for home insurance: Before purchasing an insurance policy, make sure you have read the terms and conditions so you know exactly what is and isn’t covered.
- Conditions are subject to change: You might need to let your insurance company know if your house undergoes any substantial improvements (like an addition).
THE PROS AND CONS OF RESIDENTIAL PROPERTY INSURANCE
Having home insurance doesn’t just offer protection against physical damage to your property. It also protects you if you face any legal issues or damage to your home due to circumstances outside your control.
However, you will not get continuous cover for your insurance premiums, as most people use their home insurance for a limited period.
This means that you could experience a gap in cover if the insurance company changes or if your premium increases.
Therefore, it is important that you make sure that you’re covered against the risks that are relevant to you. For example, if you rent out your property and your tenant causes damage to the property that you are responsible for, your insurance should cover this.
Most policies will also include additional extras like fire and flood cover, along with some contents cover. However, you will need to check to see what your policy covers to get an accurate idea of the type of cover you need.
Here is a list of the pros and cons that are associated with having residential property insurance:
- Your home is protected from fire, theft, and other disasters. Most insurance policies include cover for fire damage as well as damage caused by lightning strikes, vandalism, storms, floods, earthquakes, landslides, sinkholes, riots, and even nuclear accidents.
- You can use your insurance payout to help repair your home. If your property is damaged by a covered event, such as a fire or a flood, you can use your insurance payout to help repair or replace damaged items in your home.
- You can keep your assets safe during times of financial hardship. If you have a financial emergency, such as a job loss or other financial problems, you can use yours.
- The cost of living increases with every year that passes. If your policy expires and you no longer have home insurance cover in place, you may find that the cost of living has increased since the last time that you took out a policy.
- You might not receive as much cover as you would like. Many insurance policies come with certain exclusions.
- Some insurers charge higher premiums after certain incidents occur. For example, if you install a burglar alarm or a fire alarm on your property after your insurer has already issued you a policy, the insurer may charge you a higher premium when your policy renews.
- If you have a bad year, you could lose everything. This is the worst-case scenario, and the worst that can happen is that you will lose everything that you have worked so hard for.
- It’s hard to find insurance that covers all of your needs. Because there are so many different policies on the market with so many different benefits and so many limitations associated with them, it can be difficult to find an insurance policy that perfectly meets your needs.
In summary, if your home has been damaged by fire, theft, flood, vandalism, etc., it can be very difficult for you to get back on track financially. With an appropriate amount of cover in place, you could use your payout from your insurer to help repair your house without losing too much money. You also have the option of selling your home at its full value without losing too much money because you would only lose what was left over after paying off your mortgage.
If you ever experience financial hardship, you might want to think twice before filing a claim since insurers often charge higher premiums after certain incidents occur.