Home Insurance Types that Buyers Don't Really Need
While it is natural for homeowners to desire protecting their largest investment by purchasing as much home insurance as they can, there are some product types out there that simply aren't worth the purchase. Here are some insurance types that you can make do without if you are hellbent on cutting down on insurance payments:
Private mortgage insurance - Private mortgage insurance is mandatory for home purchases with less than 20% down. However, if you can pay 20% DP or more, then you have the option to avoid the PMI. This mortgage insurance only benefits the lender, so it is best to get rid of it at the soonest possible time. You have the option to use lender-paid PMI, single-payment PMI, or piggyback loans to help you avoid this additional insurance cost.
Mortgage protection life insurance- This insurance type protects your family when it comes to paying your mortgage in case of your unexpected, early demise. However, insurance experts are inclined to recommend you to invest your money on term-life insurance policies from a well-rated insurance company that can give you more protection per premium dollar.
Umbrella insurance - Umbrella insurance is basically insurance for your insurance. It works by covering a larger amount of damage than your primary insurance coverage. However, experts deem it unnecessary as regular insurance typically covers almost all your home's entire value. Umbrella insurance is just an option for people who are "reasonably expecting a rise in income" who can afford the additional cost.
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