Introduction to home insurance
Why do you need home insurance? Your house is your most prized possesion and your largest asset. Your home insurance shelters your most prized belongings: your home, your personal possessions and even your financial future.

What is home insurance?
The home insurance policy is usually a term policy—a policy that is in effect for a fixed period of time. The home insurance payment the insured makes to the insurer is called a premium. The insured must pay the insurer the premium for their home insurance each term. Most insurers charge a lower premium for home insurance if it appears less likely the home will be damaged or destroyed: for example, if the house is next to a fire station, or if the house is equipped with alarms and sprinklers.

How does home insurance protect you?
Your home insurance usually shelters you in two ways: financial loss and personal liability.

Financial Loss: Your home insurance will refund you if your home or personal possessions are stolen or if any other an unforeseen situation that is specified under your property insurance policy occurs.

If an unforeseen situation, like a fire, does arise, your home and garage will likely need to be restored. You will be reimbursed for the value of items, such as furniture, cameras and computers—or the items themselves will be replaced.

If you cannot live in your home while it is being restored after a loss, your house insurance will pay for some of your extra living expenses, such as accommodations, restaurant meals and storage.

Whether you make your home in a house, or a rental unit, the best way to protect it, your possessions and your liability is to purchase property insurance.