In order to guard against the risks and damages caused by a fire in your home, fire insurance is a guarantee of security to protect your real estate investment and belongings. However, except in a few special cases, taking out a fire insurance policy is not compulsory. So, should you insure against fire? Engel & Völkers, the expert real estate group, weigh up the pros and cons.
A mandatory requirement?
In general, an owner is not required to take out a fire insurance policy for his home. However, it can sometimes be necessary in the case of a mortgage loan: in some cases, banks refuse to lend to first-time homeowners if they are not insured against fire. Just like landlords or owners, the banks want to secure their investments.
If 90% of tenants and 95% of homeowners choose to take this type of insurance cover, this is simply to guard against the significant damage that a fire could cause both to their personal belongings and to the building itself.
What does your fire insurance policy cover?
In return for a low monthly cost, a fire insurance policy generally protects your personal possessions. It also gives you a financial guarantee, especially because the fire could be your fault and therefore, cost you a lot. While Engel & Völkers agrees that that fire insurance is not compulsory, we strongly encourage you to subscribe to it; otherwise, you run the risk of burdening your budget for the slightest incident.
Fire damage is very expensive. This type of insurance reduces the cost of damages since your insurer takes care of them. In order to secure your investment and protect yourself from having to repay significant costs, you have every reason to cover yourself against the risk of fire.