Since I own my home outright, can I cancel the homeowner's insurance?

Why can't I just pocket the $5000 I pay every year and use it to repair my home if any damage happens instead of just giving money away to the insurance company? I live in Florida and pay about $5000 per year for insurance. I own the home outright and have upgraded to all the safety features one can to protect my home from damage.

Answer
“Due to the constant and inevitable weather damage Floridians face every year, Florida has some of the highest home insurance rates in the country. Since insurance carriers sustain significant financial losses, there aren’t many insurance options to choose from.
Because you own your home, you can cancel your insurance policy and save the money, but think about it very carefully before you do. Carrier options are so limited in your area and you may not be able to find other coverage if you change your mind.
Home insurance covers much more than just the structure of your home. If you have a catastrophic loss, you would also lose all of your personal property. Personal property includes things like:
  • clothing
  • furniture
  • electronics
All of this would add up to much more than $5,000.
Liability is also covered as a part of your home policy. Not only are you protected from a lawsuit if someone gets hurt on your property, but if you injure someone accidentally while you are away from home, you will be covered up to the limits of your policy as well.
If you are one of the lucky few that has several hundreds of thousands of dollars in the bank and can afford to replace your home and belongings without any assistance, then you can afford to cancel the policy.
If you want to look for the cheapest rates, try using Jerry. The free app pulls rates from the top 50 companies in under a minute.”
avatar
Shannon Martin
Answered on Jul 26, 2021
Shannon is an expert in personal lines liability insurance with 13 + years of insurance industry experience. She also served as a special insurance liaison to AARP members for 6 of those years. She is a graduate of UL Lafayette and currently resides in NY with her family. Shannon is also an amateur juggler, ukulele player, and is a time travel paradox theory enthusiast.
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