It’s Time To Spring Clean Your Homeowners Insurance Policy
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As you make your way through your spring-cleaning checklist, don’t forget one very important thing: now is a good time to review your homeowners insurance policy. In this podcast episode, we team up with Gary Pozsik of Health, Wealth, and Happiness to talk about life events that may prompt a policy review and which elements of your home insurance policy you should assess.
Make sure you’re not overpaying for insufficient coverage
Experts say the top insurance mistake is being underinsured. This often happens to homeowners because they forget to update their coverage as their property or needs change.
Consider any activities, renovations that could impact your coverage needs or risk levels. Do you like to entertain at home? If so, consider increasing your liability coverage and purchasing an umbrella policy, which can offer $1 million of additional liability protection.
Significant home renovations can boost your home’s value, but if they are not factored into your homeowners insurance coverage, you can face hefty rebuilding costs if disaster strikes. Work with your trusted insurance agent to reassess your home’s value and cover any gaps.
Make sure your coverage keeps up with changes in your lifestyle
Did you know that certain life milestones can have an impact on how much you pay for homeowners insurance?
For example, you may be eligible for a discount if you’ve recently retired. This may depend on your profession and your insurer. Some insurers – like Farmers – may even offer discounts in some states if you haven’t smoked in two years.
Pay attention to increased rates
While doing your spring cleaning, dig out last year’s documents and compare those rates to what you are currently paying.
Insurance companies may not tell you how much your rates increase upon renewal, so it is important to monitor these changes and ensure you’re not the victim of unreasonable rate hikes.
If your rates rose more than five percent in the last year, call your insurance agent for an explanation.
Consider additional protection against natural disasters
If you live in an area prone to natural disasters – such as floods, earthquakes, hurricanes or tornadoes – consider an extended or guaranteed replacement policy. This can protect you from inflated labor and material costs that often follow catastrophes.
Make sure you have enough personal property insurance
Most homeowners don’t take the time to inventory their personal possessions and don’t have enough personal property insurance. If you’ve added to your belongings over the last year – like getting a new TV, laptop, or high-dollar gift during the holidays – you should review your current personal property insurance and make sure you have the right type of coverage for the actual value of your property.
If your personal property is worth more than your current coverage, consider increasing the dollar limit. You may also consider adding a rider to your homeowners insurance to cover any high-priced items.
When disaster strikes and you need to make a homeowners insurance claim, you’ll need to know exactly what you own and what it’s worth. Having an updated list and video footage of your belongings could help you recover the true worth of your belongings – learn more about how to create one.