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Home insurance is the most annoying unnecessary product designed by the banks to make home owners pay more for the goods they already have. What are we protecting our houses from South Africa does not get two hundred kilometre winds howling through the average neighbourhood. However, home insurance is not just about protection against winds.

Home insurance is very often misunderstood and this leads to people not realising just why you need it. There are four main types of home insurance: insurance of the homes structure, insurance on home loan debts, insurance of household contents and insuring your wellbeing.

Number One – Insuring Your Homes Structure
Insuring your homes structure is not simply protecting you in the events of howling winds. Think about your weekly activities – in summer South Africans braai. Imagine setting up the Webber braai and just as the coals are red hot (indicating the perfect time to throw the steak on) the damn dog runs past, after their toy, and bumps the braai over. The flames hit the dry lawn and suddenly it gains momentum. What about a simple roast in the oven, how many times do we hear about the oven flaming and burning down the kitchen?

Instead of having to fork out hundreds of thousands on a simple accident, why not have the peace of mind of insurance. Insuring the homes structure allows you to safeguard yourself against the fire, a geezer bursting or even the electric gate breaking.

Number Two – Insurance On Home Loan Debts
During the recession more and more people are facing retrenchment. What happens to your wife and children if you cannot afford the bond repayments? This insurance is essential when buying a property, this protects you against having to deal with mortgage payment shortfalls and ensures the loan repayments can be met.

This loan protects you in the event that the household’s bread winner passes away, has an accident and becomes disabled or becomes terminally ill. This insurance is designed to help you ease the financial burdens that accompany deaths, illnesses and disabilities.

Number Three – Insure Your Home Contents
Your house contains hundreds of items that you have acquired throughout your life. Diamond rings, expensive golf clubs, paintings, television sets and vehicles. Insuring these items ensures that in case of a break in you are covered.

Home content insurance is completely customised to your needs and possessions. This insurance will ensure goods are replaced speedily and with the minimum inconvenience.

Number Four –Insure Your Own Wellbeing
One needs to stay ahead of your finances. Consider you vehicle expenses, the children’s education, retirement annuities and even medical aid. It is important to look over your portfolio from time to time to ensure it meets your needs. Remember there are always new and better products on the market.

There are three ways to insure your own wellbeing: estate planning, investment advice and retirement planning.

One – Estate Planning: Ensure that your will is correct, up-to-date and clear. This will ensure your dependants are not locked in court room battles and unable to pay off bonds or loans.

Two – Investment advice: Everyone wants to have a larger nest egg. Insuring your wellbeing means creating a risk free way for you to increase your wealth.

Three – Retirement Planning: We all should ideally start saving from the day we receive our first pay check. However, life gets in the way. Insuring your wellbeing will assist you plan for the future and budget your expenses correctly, ensuring you get the most out of your money.

This article was written by a home loan payment calculator and second home loan calculator specialist.