As weather patterns change across the globe, there is more of a risk of damage to your home from storms, extreme cold, and fires. It seems that even the "nicest neighborhoods are experiencing random events of vandalism and theft.
If your home is damaged by a storm, fire, theft or vandalism, or if an accident results in injuries, you will look to your homeowners' insurance policy to make you whole. Your coverage and rates are based on the value of your home and its contents and the level of risk, but those variables can change over time. When was the last time that you reviewed your homeowners insurance policy to make sure you have the right coverage? Here are a few benchmark times to review your coverage.
1.When Your Policy Is up for Renewal
If your insurance renewal date is approaching, you should receive a letter detailing your current coverage limits and future premiums. Before you agree to the terms, review the document and figure out if your existing coverage is still adequate for your needs. If the company has made changes to its policies, make sure you understand how they will affect your coverage and premiums. If your rates are higher than you’d like, you can switch to a higher deductible or look for a less expensive policy with a different insurer.
2. When You Make Changes to Your Home
If you make major home improvements, be sure that your insurance company knows. A new room, deck or shed can affect your coverage needs and rates. If you install a pool, you’ll need to have high liability coverage in case there’s a serious accident. Some companies don’t cover trampolines or deny homeowners insurance coverage altogether when one is involved.
On the other hand, upgrades that make your home safer may lower your rates. If you’ve installed a security system, sprinklers or other safety features, you may qualify for discounts.
3. When You Buy Expensive New Things
Your coverage for property is based on the total value of belongings in the house. If you recently bought something expensive, or if you received something of value as a gift or inheritance, you may need to adjust your coverage or get a floater or endorsement to cover those items. If someone recently moved in with you, you may need to increase your coverage to include the value of that person’s possessions.
4. When Your Family or Lifestyle Changes
Marriage, divorce, the birth or adoption of a child, or a family member moving in or out, can all affect your coverage needs. If you’ve recently experienced any of these events or anticipate them, contact your insurance company to discuss any changes you should make to your policy.
5. A New Pet
Insurance companies consider dogs risky because they could bite someone and cause injuries. If you get a dog that’s classified as an aggressive breed, your insurance company may raise your premiums or exclude coverage for your pet altogether.
6. Home Based Businesses and Rentals
Using your house to make money can also affect your insurance coverage. If you start a home-based business or rent out your house, you’ll need to have an appropriate business insurance policy.
Think About How Changes Could Affect Your Insurance Needs
Your homeowners insurance needs change as your life changes. Whenever something significant happens in your life or at your home, talk to your insurance company or agent to make sure you have the right coverage. In fact, it is a good idea to review your policy with your insurance agent on at least an annual basis. Some of those "insignificant" changes in your life may have consequences if you are not adequately insured for them.