Just like car insurance is mandatory if you drive a vehicle in the USA, if you own a home that still has a mortgage attached to it homeowner's insurance is as well.
It may seem like an expensive extra you could live without but there are plenty of good reasons it exists.
Before you buy any homeowner's insurance though it is crucial that you know what you are getting and when you might need to adjust your coverage levels in the future.
Like any other insurance policy, not all homeowners' insurance policies are created equal.
There are those insurance companies that provide better coverage, and some homes (and their contents) are just worth more than others.
Your mortgage broker will very likely be able to advise you how much homeowner's insurance you should carry based on the basic construction and value of your home but it will be up to you to make a decision about its contents.
For instance, the average homeowner's insurance policy will provide up to about $2,500 worth of coverage for electronics and computers.
Great if you are single but as many family homes boast more than one computer these days, not to mention some pretty expensive entertainment and gaming gadgets that amount would be woefully inadequate in the event that disaster struck.
Ensure that the policy is crafted to your needs and your home, not to some national average that may have been calculated a decade ago.
When homeowners take on a home improvement project of any size, from a new electrical and wiring upgrade to a full blown home addition about the last thing they are thinking about is how this affects their homeowner's insurance policy.
Instead they are obsessed with builders, contractors and finding new shiny things to further enhance their remodeled home.
The fact is though if you are spending a nice chunk of change on a remodel or renovation that enhancement to your home needs to be insured.
Any home improvement that alters the value of your home should be covered by your home owners insurance.
You should do this as soon as possible, as unfortunately disaster can strike at any time and to find that your brand new kitchen extension will not be covered under a claim because you forgot to call that nice Mr.
Jones at the insurance company to tell him about it is something no one wants to hear.