As a homeowner, your property is one of your most significant investments, and protecting it with homeowners insurance is essential. However, simply purchasing a policy and forgetting about it can leave you exposed to risks or paying more than necessary. Reviewing your homeowners insurance annually, especially during your policy renewal period, is critical for ensuring you have the right coverage at the right price.
At Property Protectors, we understand the importance of staying up-to-date with your homeowners insurance to safeguard your home, family, and belongings. In this blog, we’ll discuss why you should review your homeowners insurance policy annually and how doing so can help you maintain adequate coverage while potentially saving money.
1. Changes in Your Property Value and Needs
Over the course of a year, your home and personal circumstances may change. Reviewing your homeowners insurance during renewal allows you to make sure your policy reflects these changes.
Key Changes to Review:
- Home Improvements or Renovations: If you’ve made significant improvements to your home, such as adding a new roof, remodeling the kitchen, or building an addition, you may need to adjust your coverage to reflect the increased value of your home.
- Purchasing Valuable Items: If you’ve acquired high-value items like jewelry, electronics, or collectibles, your current policy may not provide enough coverage. Updating your personal property coverage ensures these items are properly protected.
- Changes in Living Situation: If your family size has increased or decreased, or if you’ve recently started a home-based business, you may need to modify your policy to ensure you have adequate liability coverage.
Tip: Document any changes to your property or belongings and review your policy accordingly to avoid underinsurance.
2. Adjusting Coverage Limits for Inflation
Over time, the cost of rebuilding your home or replacing your personal property can increase due to inflation. It’s essential to ensure that your coverage limits are adjusted accordingly to avoid being underinsured in the event of a disaster.
Why Inflation Adjustment Matters:
- Rebuilding Costs: The cost to rebuild your home can rise with inflation, especially if construction materials and labor costs increase. Ensuring that your dwelling coverage is up-to-date will ensure that you have enough protection to rebuild after a total loss.
- Personal Property Value: As the value of your personal property increases, your policy should reflect that to ensure you have enough coverage to replace items in the event of theft or damage.
Tip: Ask your insurer if your policy includes an inflation guard clause, which automatically adjusts your coverage limits to account for inflation.
3. Reviewing Policy Exclusions and Add-Ons
Your homeowners insurance policy may have exclusions or limitations that leave you vulnerable to certain risks. By reviewing your policy each year, you can identify areas where additional coverage may be needed or where exclusions might impact you.
Common Areas to Review:
- Flood and Earthquake Coverage: Standard homeowners insurance doesn’t cover flood or earthquake damage. If you live in a flood-prone or earthquake-prone area, it’s essential to consider adding these coverages to your policy.
- Liability Coverage: If you’re hosting more gatherings or making significant changes to your property (e.g., adding a pool or a trampoline), you may need additional liability coverage to protect against accidents on your property.
- Specialized Coverage: If you own high-value items, such as antiques, artwork, or expensive jewelry, you may need to add scheduled personal property coverage to ensure they are fully protected.
Tip: Speak with your insurer about any exclusions in your policy and consider adding endorsements or riders to tailor your coverage to your needs.
4. Comparing Rates from Different Insurers
Just because you’ve been with the same insurance company for years doesn’t mean you’re getting the best rate or coverage. Annual policy renewal is a great time to compare rates and coverage options from other insurers to ensure you’re getting the best value.
Why Shopping Around Matters:
- Potential Savings: Insurance rates can change over time, and another provider may offer more competitive pricing for the same or better coverage. Comparing quotes from multiple insurers can help you find a more affordable option.
- Better Coverage Options: Your needs may have changed since you first bought your policy, and another insurer may offer coverage options that better suit your current situation.
- Customer Service and Claims Satisfaction: Take time to research customer service ratings and claims satisfaction when choosing your insurer. Good customer support and fast claims processing can make a big difference when you need it most.
Tip: Be sure to review the same coverage limits and deductibles when comparing quotes to get an apples-to-apples comparison.
5. Avoiding Gaps in Coverage
Failing to review your policy regularly can lead to gaps in coverage. A policy that was adequate years ago may no longer be suitable for your needs. Annual reviews help you ensure that you’re fully covered and won’t be left with expensive out-of-pocket costs if disaster strikes.
Common Gaps to Look For:
- Changes in Property Condition: If you’ve made structural changes to your home, check to ensure that your policy covers the new features. Additionally, if any part of your home is now at risk (e.g., a leaky roof or old plumbing), make sure it’s adequately covered.
- Natural Disasters: If your area is prone to wildfires, hurricanes, or other natural disasters, your standard policy may not cover all types of damage. Ensure that you’re covered for specific risks based on your location.
Tip: Be proactive in identifying any new risks that may affect your property, and update your policy to cover them.
6. Taking Advantage of Discounts
Insurance companies often offer discounts that can lower your premium. Reviewing your policy each year gives you the opportunity to take advantage of these discounts if you qualify.
Common Discounts to Look For:
- Bundling: Many insurers offer discounts for bundling your homeowners insurance with other policies, such as auto or life insurance.
- Safety Features: Installing safety devices, such as fire alarms, security systems, or deadbolt locks, can often qualify you for discounts on your premium.
- Claims-Free History: If you’ve had no claims over the past few years, you may be eligible for a claims-free discount.
Tip: Contact your insurer to inquire about available discounts and take advantage of those that apply to your home.
Contact Property Protectors to Work With Our Public Adjuster Today
Reviewing your homeowners insurance annually is essential for ensuring that your property is adequately protected and that you’re not paying more than necessary. By considering changes to your home, adjusting coverage limits, and shopping around for the best rates, you can save money and maintain the peace of mind that comes with comprehensive coverage.
At Property Protectors, we offer personalized guidance to help you find the best homeowners insurance coverage for your needs. If you’re ready to review your policy or explore new options, contact us today to schedule a consultation.
Contact our public adjuster today to schedule a free consultation.