Q: My husband and I are both in our mid-40s and own a small home with no mortgage. Based on previous experience with windstorm insurance, we have not purchased this coverage on our home, and we only have homeowners’ insurance. Is this a dangerous way to save money and to be in control of who and how to repair our home if a hurricane damages it? — Amanda
A: It is essential to get appropriate insurance to fit your situation.
There are many forms of insurance that people have to choose from. Young, healthy people have different health insurance needs than older people. The same applies to different types of homes owned by people in different situations.
People who have mortgages must carry certain types of insurance depending on where they live. Banks tend to be careful with the money they lend, and valid good reasons to require insurance.
While it is essential to be adequately insured, it is wasteful to be over-insured.
Every property owner should have hazard insurance, which covers many perils such as fire, theft, liability, and other unexpected damage. The coverage will help you repair your home and protect you if you get sued.
Depending on where you live, other types of insurance make sense. Flood, windstorm and earthquake insurance can provide essential insurance where appropriate.
However, insurance policies have limitations and may not cover every situation. Each insurance company is different; some treat their customers better than others.
Even the best insurer may make a mistake leading to the experience that soured you on windstorm coverage.
If you can afford to repair or replace your home if a hurricane damages it, self-insuring against it can be a viable option. You should weigh the risks against the ever-increasing cost of insuring your home.
Another option would be comparing insurance companies to see if one offers a policy that better fits your needs.
For most people, self-insuring is a bad idea, but there is a small minority for whom it makes sense.
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