If you’re considering buying a home, you’ve probably heard about homeowners insurance — and you might have groaned about being required to pay for it.

Concern over the cost of homeowners insurance is understandable, as it costs the average US homeowner $952 annually (in addition to mortgage payments and property taxes).

But while the price of homeowners insurance is significant, it provides homeowners with powerful benefits and protections. It also gives mortgage lenders confidence that their financial investment in your home is protected if the home is damaged or destroyed.

To help you better understand why it’s an important part of home ownership, here are four ways homeowners insurance protects you and your home:

It covers the cost of rebuilding your structure

Nobody enjoys thinking about it, but disasters happen. If your home was destroyed in a catastrophic event such as a fire, homeowners insurance can  cover the cost of rebuilding the structure if the damage falls under the policy scope.

Your coverage amount determines how much an insurance company pays toward rebuilding your house, so it’s important to make sure the amount is adequate.

It covers the cost of replacing your belongings

Standard homeowners insurance policies also cover personal property loss or damage from theft or other covered events. Creating and maintaining a list of your belongings helps you estimate the amount of coverage you need and also comes in handy if you have to file an insurance claim.

Expensive items such as artwork and antiques often need riders to ensure coverage. A rider is extra insurance for a specific item and is attached to your regular policy.

It provides liability coverage

While you never intend for a guest (or a worker) to get hurt on your property, accidents can happen. The liability portion of your homeowners insurance policy covers injuries suffered by others on your property. It may also help pay for their resulting medical bills.

Additional living expenses

If you’re unable to stay in your home after covered risks such as a fire, homeowners insurance helps cover your hotel bills, meals, and other costs while your home is being rebuilt.

You’ll also gain peace of mind from having homeowners insurance

Owning a home is a huge responsibility and commitment. While homeowners insurance adds additional financial burdens, you’ll gain peace of mind knowing your home is protected during unexpected events and catastrophes.