Why do I need car insurance?
Liability car insurance is required to drive legally in nearly all states because it helps pay for damage and injuries to others that you cause in an accident. It also helps pay legal costs if you’re taken to court because of an accident. Optional physical damage coverages, comprehensive and collision, pay for damage to your own car regardless of fault. Though it does cost the average driver around $1,300 for full coverage car insurance, it can save you a lot of money. Here’s why:
You’re financially protected - with no car insurance, you’d have to pay out-of-pocket for accidents and injuries you cause
Your house, savings and assets aren’t at risk should you cause an accident
You get reimbursed so you can repair your car after an accident
Am I required to have home insurance if I own a home?
Unlike driving a car, you can legally own a home without home insurance. However, if you finance your home with a mortgage, your lender will most likely will require you to have home insurance coverage to protect your home in case of damage cause by unforeseen circumstances, such as fires or natural disasters.
If you live in an area that is prone to flooding or earthquakes, your lender may also require you to purchase flood insurance or earthquake insurance.
After you pay off your mortgage, you aren't required to have your home insured. However, you should keep your home insurance policy active to avoid risking what you've invested in your home.
If you purchase a condominium or co-op, your condominium board may require you to buy condo insurance or home insurance. Be sure to check with your board to see what type of policy is required.
If you're looking to insure a townhouse and your townhome association has a master policy (which typically covers the structure and common areas), you'll get renters insurance. If your association does not have a master policy, you'll get home insurance.