Top 4 Reasons to Review Your Homeowners Policy Every Year

03 Feb

In many cases, your home is your most valuable asset so you should always make sure it is fully protected with the proper insurance coverage. In order to ensure that you have enough coverage, you should review your policy and coverage levels on an annual basis. Checking out your policies and coverage levels at the beginning of a new year is always a smart idea.

Due to rising property values in large parts of the country, ensuring that you have enough homeowners insurance coverage has never been more important. You should check your policy, carefully looking at the following:

  • Policy limits
  • Types of property that are covered
  • Covered disasters 
  • Any coverage exclusions that may impact you
  • Different deductibles for wind or hail damage

While reviewing your policies is never a fun job, it is absolutely something that should be done on a regular basis, yearly if possible.

Checking these details is important

There are numerous reasons to review your insurance policy on a year basis, here are just a few to consider:

  1. Property values and construction costs: The pandemic has dramatically pushed up home values across the country. In some markets, prices are up 30 percent or more. These massive increases have also pushed up the cost to rebuild homes as labor and building supplies are in short supply. Check that your policy is a replacement value policy which will cover the cost to replace your possessions regardless of depreciation. Verify that you are carrying enough coverage to properly rebuild your home as rebuilding costs climb. Your agent or a local contractor should be able to advise on the cost per square foot to rebuild. 
  2. Homeowners upgrading their homes: The pandemic left people with more time at home which has resulted in many homeowners upgrading their homes. If you have made substantial improvements to your home, redone a kitchen, added a bathroom, replaced your roof, or even added square footage to your home, you should absolutely check your coverage levels and possibly up them. Notify your insurer or agent about your improvement to see if more coverage is necessary. 
  3. Bringing a new pet home: Pets, particularly certain dog breeds can be an issue with homeowners insurance. Many insurers charge additional fees or may not offer coverage at all if you have a certain breed of dog (pit bulls are an example) so if you have recently brought a new pet into your home, you should notify your insurer to see if your policy needs to be adjusted. 
  4. Update your personal property inventory: Homeowners insurance not only protects your home but your personal possessions as well. A home inventory is important as it will make sure you are paid out quickly and fairly if you must make a claim on the policy. There are several apps that make a home inventory less tedious. If you have purchased new home items over the last year, make sure they are added to your home inventory. Include photos as well as purchase price details in your inventory. 

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