Home insurance is not required by any state or federal law. When you get a loan from a bank to buy a home, the lender will require you to have home insurance that covers the mortgage, at the bare minimum. The bank wants to make sure that they will get their money back if the home is destroyed before you finish making payments on it.
If you are fortunate enough to have paid off your mortgage, you are no longer required to have home insurance because you do not owe the bank any money. Even so, it is still a very wise purchase because home insurance ensures that your investment is protected.