Home Insurance is NOT compulsory! If you own a home and are financially secure and independent of any contractual or mortgage obligations, whether you self insure or purchase homeowners insurance is totally an independent decision.
Since the purpose of insurance is to spread one's risk over a large pool of people having the same class of risk, it could be assumed that if one were to have a great sum of assets and wish to underwrite their own risk, in some cases, it may be an advisable task to take.
For the average homeowner, a fire, wind, water damage or liability loss could mean absolute devastation and financial ruin. It is well noted in all regions of the country that many retired people choose to discontinue paying for home insurance after their mortgage is paid off, many times, these same people may begin to close an eye to necessary maintenance issues on the home thus causing a fire or jeopardizing the safety of the home to other perils; many families have been devastated in the course of saving the cost of an inexpensive insurance premium.
That's a great question! Many mortgage lenders will require that you have some form of proof that they can get paid in the event your home were damaged or destroyed before they were fully paid off. That is usually done through your homeowners insurance or private mortgage insurance (pmi). So while it isn't mandatory to have insurance, most lenders are going to want to know that their money is safe, and will require insurance before lending you their money. And unless you are very financially secure, it always is wise to have a way to cover the risks of losing your belongings, home, or protecting against being sued. Thanks for asking!
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Since the purpose of insurance is to spread one's risk over a large pool of people having the same class of risk, it could be assumed that if one were to have a great sum of assets and wish to underwrite their own risk, in some cases, it may be an advisable task to take.
For the average homeowner, a fire, wind, water damage or liability loss could mean absolute devastation and financial ruin. It is well noted in all regions of the country that many retired people choose to discontinue paying for home insurance after their mortgage is paid off, many times, these same people may begin to close an eye to necessary maintenance issues on the home thus causing a fire or jeopardizing the safety of the home to other perils; many families have been devastated in the course of saving the cost of an inexpensive insurance premium.