Reviewing and Updating Your Homeowner's Insurance

When was the last time you reviewed your home insurance policy? According to Loretta Worters, vice president of the Insurance Information Institute, there are five events that should trigger a review.

  1. When your policy comes up for renewal.
    Don’t just automatically send a check to your insurance company. Take the time to review your coverage and call your agent with any questions or concerns that you may have regarding your homeowners insurance. Ask yourself the following questions:
    • Has the company made any changes in coverage since last year?
    • Does my policy now include a separate deductible for risks like hurricane or hail?
    • Should I raise the deductible to save money or comparison shop for cheaper rates?
    • Am I taking advantage of all available discounts?
    • Do I need to raise the amount of coverage for liability, personal possessions or the structure or add a flood, earthquake or an umbrella policy?
  2. When you’ve made major purchases or alterations/improvements to your home.
    If you have made any major purchases or received any expensive or valuable gifts, ask your agent about either increasing the amount of insurance you have for your personal possessions or purchasing a floater/endorsement for these items which will give you higher and broader coverage for these items than you have under your homeowners policy.
  3. When you’ve increased the square footage of your home.
    If you’ve added a new room, enclosed a porch, expanded a kitchen or bathroom, or added a new structure outside of your home such as a gazebo, shed or pool or hot tub, report the updates to avoid being underinsured. Keep receipts and records in case you need to forward copies to your company.
  4. When you’ve made your home safer.
    If you have installed a state-of-the art fire/burglar alarm system or upgraded your heating, plumbing or electrical system, make sure that your insurance company knows about these improvements. You may qualify for a discount.
  5. When the number of residents in the home changes.
    Marriage, divorce, children leaving home or elderly relatives moving in can also change the amount of valuables and possessions that need insured.
  6. When you’ve started a home-based business.
    Talk to your agent about additional coverage for business liability and equipment. If the business is your primary source of income, you may need a Business Owners Package Policy (BOP). You may also need professional liability coverage, which is excluded under in-home business and business owner’s policies. For more information, see III’s Business Insurance section.