Fire Insurance For "Mortgage Home"

By obtaining a mortgage loan, it is the client's obligation to the bank to insure the mortgaged property based on the coverage requested by the Bank. However, the mandatory basis of the law is the insurance of the mortgaged home and not the choice of the insurance company. Every homeowner can go to any insurance company and choose the best plan for himself and his property. Specifically, the Consumer Credit Act provides the following:

“Any insurance coverage that a mortgagee may require a debtor to conclude and maintain in respect of immovable property mortgaged to the mortgagee may be negotiated by the debtor with any insurer”.

The insured amount is determined by the value of the property and not by the amount of loan you have taken from the bank. Be sure to insure your property at the real value of the rebuild and not at the loan amount. It is noted that the value of the land is not considered, but the value of the property and the cost of reconstruction. The cost is to restore the property to the same condition as before the loss.