As you shop for your new home in Ohio, you’ll likely have questions about homeowners insurance. Your home is a significant investment that should be protected with the proper coverage.
Nevertheless, you might ask yourself: Do you have to have homeowners insurance in Ohio? And what happens if you don’t have homeowners insurance?
In the state of Ohio, there are no laws that require you to have homeowners insurance. With that being said, there may be other scenarios in which you are required to purchase coverage. If you have a mortgage, your mortgage lender will likely require you to purchase homeowners insurance.
This article covers Ohio homeowners insurance laws, when you’re required to buy coverage, and why having home insurance is essential.
Ohio Homeowners Insurance Laws
While homeowners insurance is not legally required, there are still laws that can impact homeowners insurance in Ohio. According to the General Assembly of the State of Ohio, a lender is within their rights to require a customer to purchase coverage.
However, some additional conditions apply to this legislation. For one, a lender is not allowed to require homeowners to purchase coverage that “exceeds the replacement value of the dwelling and its contents.” Additionally, a lender can’t require you only to buy coverage from a specific carrier.
A mortgage lender in Ohio can require you to buy homeowners insurance up to the replacement value for your home and belongings.
Why Homeowners Insurance Is Essential
Do you have to have homeowners insurance? Ideally, yes, but it’s not mandatory. However, you may want to know what happens if you don’t have homeowners insurance. It’s never a good idea to leave your home uninsured because you might find yourself in a tight situation if an accident happens. Here are five reasons why you need to have insurance for your home:
1. It saves you money.
If your house is destroyed or damaged in some way, insurance can help pay to rebuild what was lost and even cover the cost of hotel stays for what could be months at a time. This is what’s called “replacement cost coverage,” which covers the repairs done so that your home is back to what it was before.
2. It protects your credit score.
If you do not have insurance, what will happen? Will the bank foreclose on what you owe? Will they let you rebuild or fix what’s damaged? Either way, if your house is destroyed and there’s no insurance, your credit score could suffer. Lenders may stop giving loans to people who don’t have home insurance because it shows that they can’t manage and protect their investments properly.
3. It covers many types of damage.
There are many things that could cause damage to a house, from water leakage causing mold formation to a total roof collapse after a tree falls on it to fires started by faulty electrical wiring. Talk to your home insurance provider to learn more about what can and cannot be covered.
4. It covers what your house might be worth.
Your homeowners insurance policy will cover what your house was worth before anything happened to it. This means that if you have $100,000 in your policy, but your home is only valued at $80,000, you technically don’t lose anything. A home insurance plan can also cover what you owe the bank on your property.
5. It protects your personal items.
Home insurance can also protect what you own inside your home, including personal belongings like furniture and jewelry. The only things that it usually doesn’t cover are money or securities kept in your house.
Though you might not think anything bad will ever happen to what you own, accidents do occur every day. Protect what’s most valuable to you by making sure you have a good homeowners insurance plan.
What Happens If You Don’t Have Homeowners Insurance?
If your mortgage requires you to buy coverage and you don’t do it, you will default on your mortgage contract.
Let’s say you did purchase homeowners insurance but stopped making payments. In this scenario, your insurance carrier will inform your lender of the payment situation and your lender will then require you to catch up on your missed fees. If you’re unable to make these payments, you can face foreclosure on your home.
What if you’ve paid your mortgage off or you bought your home with cash? While you won’t be required to purchase homeowners insurance, you still face risks without it. With homeowners insurance, you can protect yourself from financial loss in case of an accident.
What To Know About Homeowners Insurance in Ohio
Even if you aren’t required to buy homeowners insurance, it helps protect your home and property. To understand the benefits of homeowners insurance in Ohio, let’s take a look at what it can cover.
Homeowners insurance can help you pay to rebuild and repair damage to your home caused by an accident or disaster. This coverage can also include theft or damage to your personal belongings within your home.
Standard Homeowners Insurance Coverage Types
Standard homeowners insurance covers four areas: the structure of your home, your personal belongings, liability protection, and any additional living expenses.
Home structure coverage pays for damage repairs. The types of damage that are covered are included in your policy, such as fire or lightning damage.
Coverage for your personal belongings protects your belongings in the event they are stolen or destroyed.
Liability protection is necessary in the event that someone is injured in your home. This coverage includes protection against third-party liability claims up to a specified amount.
Coverage for additional living expenses is necessary if your home becomes inhabitable due to loss or damage.
How To Obtain Homeowners Insurance in Ohio
There are four steps that you need to take when looking for a home insurance plan in Ohio.
1. Figure out what kind of house you have and what it’s worth.
You also need to know what possessions are in it, what they’re worth, what’s on your land, and what other items and people would be affected if there was damage done to the property or what’s inside it. You can get a pretty good estimation of all this by talking to a property appraiser or a home insurance advisor.
2. Evaluate for property perils.
Determine what perils might affect your house most often (windstorms, earthquakes, fires, etc.). Knowing what your property is most exposed to will help you determine the type of home insurance you need and other add-ons you might want to include that are specific to your situation.
3. Consider multiple options.
Talk to different insurance providers about what each is offering, what they cover, what they won’t cover, and how much they cost. Don’t just settle for the first policy that you see. You can also work with an independent service provider who can do all the research work and present you with only the best options for your needs and budget.
4. Find out where you can get the most cost savings.
Save money on homeowners insurance by bundling it with other policies (like auto or life). Most insurance providers offer special discounts for bundled purchases or if you buy home insurance with a friend who’s also buying their own.
Find the Right Homeowners Insurance in Ohio With InsurA
Do you have to have homeowners insurance? In the end, the right homeowners insurance policy for you depends on your needs. For example, if you live in an area likely to flood, you may need additional flood protection.
You can determine the type of coverage you need for your home by consulting with the experts at InsurA. Our friendly and knowledgeable insurance specialists will work closely with you to find out what you need exactly to secure your home, your belongings, and your family in a way that meets your budget.
Contact our home insurance experts today to get started.