CHICOPEE, Mass. (WWLP) – Buying a home is one of the biggest financial investments an individual or couples make in their lifetime, so it’s important to protect your property against incidents that could cause you lose everything you’ve worked to obtain.

Homeowners insurance is not required by law in Massachusetts, but if you have a mortgage your lender will require it to protect their investment. A lender cannot make you obtain coverage from any particular insurer or require you to insure your home for more than the replacement cost of the building. Like other insurance products, you can shop around to various companies to compare coverage options and prices.

Even if you pay off your home, it is still important to have insurance to protect yourself from the financial costs of unforeseen losses, such as fire and natural disasters, frozen pipes, or even burglaries.

When purchasing insurance, you should consider not only your house, but also unattached garages, sheds or other structures that may be on your property. Additionally, you should think about how much you would need to replace personal property such as furniture, clothing, electronics, jewelry, tools or other personal items that may be damaged in the event of loss to your home. Also, liability coverage to protect you and your assets from lawsuits if others claim damages due to your negligence either on or off your property.

In the standard policy, a home insurance plan may cover losses such as:

  • (1) the costs to repair or replace damaged property,
  • (2) additional living expenses due to loss of use,
  • (3) personal liability which is the cost of losses to others allegedly due to your negligence,
  • (4) the cost of medical payments to others.

Some policies may specifically exclude coverage for certain events, including floods, earthquakes, or damages related to poorly maintained properties. Depending on where your home is located, you may be able to purchase flood insurance through the National Flood Insurance Program. The insurance company can help you with application forms for flood coverage. 

As insurance companies are taking a risk to insure your property, they have the right to refuse coverage under their company standards, known as underwriting guidelines. They decide whether to give you a policy, and the rates charged for any coverage it would provide. If an insurer accepts your application, they may issue you an insurance binder, which is a legally binding statement that you have immediate protection for a specified period of time while the company decides whether or not to issue you a policy. 

If you are unable to find a company that will insure your property you have the option of the FAIR Plan. The Massachusetts Property Insurance Underwriting Association (MPIUA) also known as the Massachusetts FAIR Plan (Fair Access to Insurance Requirements) provides basic property insurance on eligible property for applicants who have been unable to gain insurance through the voluntary market. MPIUA offers policies under the Homeowners, Dwelling Fire and Commercial Property programs as approved by the Massachusetts Division of Insurance.