Is it illegal to live in a house without insurance?

Asked by: Mrs. Marilyne Stehr  |  Last update: June 26, 2025
Score: 5/5 (53 votes)

Here's what you should know: You're not required by law to have home insurance, but banks do require it as a condition of your mortgage. Home insurance can help you protect yourself from enormous financial loss. It can also help cover the cost of paying for bodily injury to others or damage to their property.

Can you live in a house without insurance?

Legally, it is acceptable to not have home insurance in California. You will not face any legal consequences, although you may be in breach of the terms of your mortgage agreement.

What happens if you have no homeowners insurance?

Fires, floods, storms, and other natural disasters can cause immense destruction to your home. If you don't have insurance, you would have to pay out of pocket for all the repairs and rebuilding costs, which could be financially crippling.

Is home insurance mandatory in CA?

While there isn't a minimum home insurance requirement in California, separate wildfire, earthquake and flood insurance may be needed depending on your home's exact location. You may want to check with your agent for guidance on the appropriate levels of homeowners insurance.

Can you lose your home if you don't have insurance?

If you do not have adequate coverage, your assets may be subject to foreclosure or repossession (in which case they could then lose your house due to an at-fault car accident).

Millions going without home insurance

33 related questions found

Is it a crime to not have home insurance?

Theresa Simes, a Farmers Insurance® agent in Fountain Valley, California, discusses the need for home insurance. A: Home insurance isn't required by law, but there are other reasons to insure your home. If you have a mortgage on it, your lender will require you to have insurance until the loan is paid off.

What happens if my house burns down and I have no insurance?

You'll Have to Pay for All Lost Personal Property Yourself

As we mentioned earlier, home insurance doesn't only cover the cost of your home. It also covers the belongings and assets you keep there. Without home insurance, you will have no assistance building back up your necessities or recovering your assets.

Is it OK not to have home insurance?

Legally, you can own a home without homeowners insurance. However, in most cases, those who have a financial interest in your home—such as a mortgage or home equity loan holder—will require that it be insured.

Is not having insurance illegal in California?

Driving without insurance is illegal. Also, you must have liability coverage to register your car. Your insurance company tells the California Department of Motor Vehicles (DMV) if you buy auto insurance or if you stop paying your premium.

Why do some people not have home insurance?

“If companies are able to issue policies, the costs are becoming more than people can afford,” Barrett says. “So we're seeing many people opt out simply because they can't afford the cost of the policy where they live, or their insurers are no longer writing policies in those places.”

What is the 80% rule in homeowners insurance?

The 80% rule means that an insurance company will pay the replacement cost of damage to a home as long as the owner has purchased coverage equal to at least 80% of the home's total replacement value.

What happens if your home is uninsurable?

If serious issues exist with the home or property, the FHA will consider the home uninsurable. Borrowers would need to contact private insurers to cover the property, or a 203K loan could be used to make the necessary repairs. U.S. Housing and Urban Development.

How long can you go without homeowners insurance?

While a brief lapse in coverage might not seem like a huge deal, going without homeowners insurance for even a day or two puts you at financial risk. Additionally, many insurance companies won't accept late premium payments. So if you continually miss payments, your policy could be canceled automatically.

Do I need insurance if my house is paid off?

But now that your loan is paid off, you are responsible for making your homeowners insurance payments. Although you are not legally required to have homeowners insurance, you should think twice before you cancel your insurance.

What states require homeowners insurance?

No states have laws mandating homeowners insurance, but, if you finance your home, your lender will typically require a home insurance policy. The standard coverages for homeowners insurance are generally the same in all states.

What is the cheapest homeowners insurance?

USAA and Auto-Owners are the cheapest home insurance companies on average, according to Bankrate's research.

Why is homeowners insurance so high?

Several factors are behind the rising rates. Severe weather events continue to cause serious damage and costly insurance claims. The rising cost of building materials, supply chain issues and unfilled jobs are driving up the costs of home repairs.

What not to say to home insurance?

Avoid Misleading Phrases: Be cautious with your words. Phrases like “I think” or “It might have been” can introduce doubt and ambiguity into your claim. Instead, stick to clear, confident statements that are supported by your evidence and records.

Can you drop homeowners insurance?

As long as the policy has been active for a minimum of 60 days, policyholders can drop their coverage at any time after this period. Is there a penalty for canceling homeowners insurance? Insurance companies do not charge fees or penalties if you simply choose to not renew the policy at the end of its term.

Can an hoa require homeowners insurance?

Can an HOA require homeowners insurance? Homeowner associations may require you to get additional insurance coverage depending on the circumstances of your neighborhood (if your neighborhood pool allows visitors, etc).

Do you still own the land if your house burns down?

If your house burns down do you still own the land? Fire may destroy your home, but it doesn't destroy your property rights. You still own your land after a wildfire. If you have a mortgage, you will still have to continue making payments.

What voids homeowners insurance?

Common exclusions in even the most comprehensive homeowners policies include: earth movement, such as earthquakes; sinkholes or landslides that damage your home; water damage, such as floods or sewer back-ups that leak through a pipe or seep through the foundation causing damage to your home; damage resulting from ...

What happens if you don't have renters insurance and there's a fire?

If your tenant fails to purchase renter's insurance, they are responsible for the cost of their damaged belongings. Additionally, if the tenant (or a guest of the tenant) is responsible for starting the fire, they may be responsible for paying the landlord's deductible on damages to the building.