Escrow is a process that ensures both parties in a real estate transaction fulfill their obligations. It does not directly include home insurance, but the purchase of home insurance is often a requirement in the process. When you are buying a home, your lender will likely require you to obtain home insurance to protect their investment. The cost of the insurance premium may be included in your monthly mortgage payment, which is then deposited into the escrow account. The escrow agent will then disburse the funds to the insurance company on your behalf. So, while the process of escrow doesn't directly include home insurance, it is a crucial part of the home buying process that ensures you have the necessary coverage.