Is Homeowners Insurance Compulsory? 
That 's a great question ! Many mortgage lenders will require that you have some form of proof that they can get paid in the event your home were damaged or destroyed before they were fully paid off . That is usually done through your homeowners insurance or private mortgage insurance -LRB- pmi -RRB- . So while it is n't mandatory to have insurance , most lenders are going to want to know that their money is safe , and will require insurance before lending you their money . And unless you are very financially secure , it always is wise to have a way to cover the risks of losing your belongings , home , or protecting against being sued . Thanks for asking ! 