Picture this: You and your spouse have just bought the new home you've been wanting for years. It has everything you want – a big yard for the kids and the dog, enough bedrooms so you can have guests overnight and still have your own home office, and a kitchen that would make Emeril Lagasse green with envy. Yes, all that time spent saving and searching has finally paid off. Your family is living in a dream home.

Until the dream becomes a nightmare when your next door neighbor is bringing you a welcome basket, slips on a loose step climbing up to your porch, and breaks both of her legs. Yes, at this point your dream becomes more than just any nightmare – it's now a legal nightmare.

Unless you have adequate homeowner's insurance.

With homeowner's insurance, you can rest assured that you, your family, your visitors, your valuables, and your property will all be protected in the event of an accident, theft, vandalism, and damages caused by certain weather elements. As long as you have adequate homeowner's insurance, your next door neighbor's accident won't result in a legal battle over who must pay for her injuries and how; your homeowner's insurance will have it all taken care of.

It's true that homeowner's insurance isn't a legal requirement, unlike automobile insurance, unless you've borrowed money to pay for the home, and you're lender requires you to purchase homeowner's insurance. For this reason, many people opt not to purchase homeowner's insurance. Who needs the extra bill, especially if you've just purchased a new home? You need it, unless you want to pay hundreds, even thousands, of dollars should the “next door neighbor” scenario become a reality for you.

So, consider purchasing a homeowner's insurance policy. Make any repairs your home might need, and take inventory of your valuables. Then, call up a few insurance companies that offer homeowner's insurance and get quotes.