Annual Homeowners Insurance Checkup. Have You Had Yours?

A lot can change in a year. Seemingly small differences can dramatically affect your homeowners insurance premium and coverage. Whether you renovated your kitchen before Thanksgiving or adopted a German shepherd for your son’s birthday, you may need more coverage or even become eligible for premium discounts. An annual meeting with your insurance agent to discuss your policy’s details can help ensure your homeowners coverage meets your needs and keeps your premiums in check.

Home Sweet Home

It is important to consider the replacement cost of your home and its features when calculating the amount of your dwelling coverage. Higher coverage requires higher premiums, but less coverage could leave you without important upgrades in the event of a total loss or rebuild. During your annual meeting, discuss with your insurance agent whether you have done any of the following in the past year.

  • Have you made any additions to your home? Have you added a bathroom or turned the garage into in-law quarters? In the event of damage to these additions, the insurance company should be aware of them in order to properly cover them.
  • Have you renovated your home? Have you finally replaced those old kitchen cabinets or outdated fixtures? Your insurance company needs to know the increased value of your home so the improvements can be repaired if damaged.

With home improvements in mind, discuss the replacement cost of your property with your homeowners insurance agent. Ask your agent to complete a replacement cost estimator to estimate your home’s current replacement cost value. You should feel confident that, if your home is damaged, you purchased the right amount of coverage to return your property to its previous condition. Remember – your coverage amount should not be based on the market price of your house. Market value is often based on the square footage of the structure and the land where it is located. In today’s housing market, this amount could be much lower than the actual cost to replace your home.

Get More For Less

Ask your homeowners insurance agent about possible discounts awarded for your home improvements. Have you installed a monitored security alarm, replaced your roof, or upgraded your opening protection (hurricane shutters, for example)? These improvements may offer discounts to your homeowners insurance premium by reducing your risk for claims. Ask your homeowners insurance agent to list the specific factors that could lower your homeowners insurance premium and consider those options.

Change in Occupancy

Certain changes to your home’s occupants can affect your homeowners insurance policy. Discuss the following changes with your homeowners insurance agent to ensure you are covered for any contingency. Examples of these changes include:

  • Is your home now a long-term rental? Perhaps you have moved to another area or your family’s needs have changed. However, if you decide to rent your property instead of settling it, you might need a different type of coverage. Your insurance agent can help you determine the proper insurance to cover your property in the event of damage and advise you on how to insure against damages from injuries that may occur on your property.
  • Do you rent your second home? Is that beach house sitting vacant during the months you are in your primary residence? If you decide to rent it while you are away, your homeowners insurance agent can help you protect both yourself and your renters. Don’t expose your assets by having a claim that isn’t covered. A simple call to your insurance agent can help protect you and your family.
  • Have you turned your rental home into your primary residence? After your older children moved away, the smaller house you have been renting may be easier to manage. Tell your homeowners insurance agent that you are no longer renting out your property and see if you can decrease your premium.

Other Things to Consider

Even a small, seemingly-unrelated change can affect your homeowners insurance policy. It is important to provide your agent with accurate detailed information. Adding a dog to the family or significant changes in landscaping may not sound like insurance issues, but can be something to discuss with your agent. A simple conversation with your agent can help to avoid discovering a gap in coverage after the damage is done.

Please remember that the comments contained in this blog are general in nature and that coverage under any specific policy of insurance will depend upon the terms and conditions of such policy.