Millennials are starting to buy homes, but what about insurance?
July 14, 2015
Insurance is not a requirement for owning a home. However, when taking out a mortgage on a home, it is common for the lender to require you to take out an insurance policy. This is more to protect them as the lender than you as the owner, but the same principle applies. As more millennials make the shift to the housing market, this is something they are learning.
Millennials are overlooking home insurance too quickly.
Millennials dealing with home insurance for the first time
For older generations, taking out an insurance policy is a no brainer. If a member of the baby boomer generation planned on taking out a mortgage, then the insurance policy would be next on the list. While there are new factors to consider, the concept of homeowners insurance has remained constant.
"You are doing yourself no favors by not having your home and belongings protected.”
However, millennials don't always place insurance as the most important item on the list when it comes to a new home. In fact, millennials are the most underinsured generation of any in this country. Roughly one in four millennials does not have health insurance, which is twice the rate of other adults. When discussing auto insurance, only 64 percent have it, compared to 84 percent of older generations. And only 10 percent of millennials are insuring their homes. But this doesn't just go for homeowners, but renters as well, as renters insurance is only attributed to 12 percent of millennial renters.
Millennials are critical of big insurance companies
This lack of is troubling, especially since millennials made up the largest percentage of homebuyers in 2014. However, the J.D. Power 2014 U.S. Household Insurance Study noted that satisfaction among millennials regarding home or renters insurance was 755 out of 1,000. Likewise, millennials are a generation that doesn't like to be advertised to, and are likely to simply turn away when being recruited by advertisements.
Being insured is important
Yet even though millennials are hesitant, they need to be aware how important home insurance insuring their home is. Having coverage is not just about doing what their parents did, but keeping themselves and their investments safe in case something goes wrong.
If you are a millennial entering the housing market for the first time, taking out a home insurance policy is a wise move, even if your mortgage lender doesn't require you to have one. Having home insurance will make sure your investment is protected from a natural disaster, theft or other catastrophe. Additionally, an insurance policy doesn't just cover the bricks and mortar, but your belongings as well.
Whether you are moving to a condo, a home or another type of housing complex, speak with insurance carriers and get a quote that meets your needs. You are doing yourself no favors by not having your home and your belongings protected. Emergencies happen, and you might as well have your belongings covered in the event disaster strikes.