Life events can have a profound effect on insurance needs. The Insurance Information Institute (I.I.I.) advises policy holders to conduct an annual review of their coverage to assess any changes that could affect their financial footing.
Talk to your insurance provider about any or all of the following:
1. Driver’s Licenses
– It’s generally cheaper to add your teenagers to your auto insurance policy than for them to purchase one on their own. If they’re going to be driving their own car, consider insuring it with your company for a multi-car discount. And choose the car carefully – the type of car a young person drives can dramatically affect the price of insurance.
2. New Jobs
– If you started a new job or experienced some other significant change in your income, replace any ‘lost’ coverage from your former employer to your new employer with individual policies. In the case of an income increase, you may have taken on additional financial commitments that your beneficiaries will depend on. Make sure to review your life and disability insurance to ensure it is adequate to maintain those commitments.
– If you’re a frequent carpool driver, whether it is to work, school or other activities, your liability insurance should reflect the increased risk of additional passengers in the automobile. Check with your agent or representative to make sure your coverage is adequate.
4. Valuable Purchases
– Have you acquired any new valuables, such as jewelry, electronic equipment, fine art or antiques? A standard homeowner policy offers only limited coverage for highly valuable items. If you made purchases or received gifts that exceed these limits, you should consider supplementing your policy with a floater, a separate policy that provides additional insurance for your valuables and covers them for perils not included in your policy, such as accidental loss. Before purchasing a floater, the items covered must be professionally appraised. Keep receipts and add the new items to your home inventory.
5. Rented Homes or Apartments
- If you’re renting a home, your landlord is responsible for insuring the structure of the building, but not for insuring your possessions. Renters insurance is a good investment. Like homeowners insurance, renters insurance includes liability, which covers your responsibility to other people injured at your home, or elsewhere, by you and pays legal defense costs if you are taken to court. It will also provide additional living expenses if you can’t live in your home in the event it is damaged by an insured disaster such as a fire.
6. Home Renovations
– If you’ve made major improvements to your home, such as adding a new room, enclosing a porch or expanding a kitchen or bathroom, report those changes to your insurance company. And don’t overlook new structures outside of your home. If you built a gazebo, a new shed for your tools or installed a pool or hot tub, you should speak to your agent.
If, as part of a renovation, you purchase furniture, exercise equipment or electronics, you may need to increase the amount of insurance you have on your personal possessions. Keep receipts and add any new items to your home inventory.
7. Second Homes
– If you’re searching for a vacation home or a second home you might retire to, research the availability and cost of homeowners insurance before you commit to the purchase. The very factors that make a vacation home seem ideal, whether it is a waterfront property or a mountain retreat, can often introduce risks that make it costly and difficult to insure – including the likelihood that it will be vacant for long periods of time.
If your new property is close to the water, be sure to ask about flood insurance. Damage to your home or belongings resulting from flood is not covered under standard homeowner insurance policies. Flood insurance is available from the National Flood Insurance Program (NFIP), as well as some private insurers. Ask your Insurance Professional whether your home is at risk for flood, or enter your address on the NFIP website to find out whether your home is in a flood zone. If you have a very valuable home, some homeowner insurers offer excess flood coverage over and above that provided by the NFIP policies.
8. Marriages or Divorces
– If you’ve gotten married and are merging two households, you may need to update your homeowners insurance. This is also a great time to create a home inventory list for possible future claims. Couples who are bringing two cars into the relationship and two different auto insurance companies should review their respective policies and see which company offers the best combination of price and service. Don’t forget to ask about discounts for multiple cars or married policy holders.
If you’ve gotten divorced, you’ve likely moved to a different residence and probably will no longer be sharing a car with your former spouse. If this is the case, inform your insurer and set up separate homeowner and auto policies.
9. New Children
– If you’ve recently added a child to your family, it’s important to review your life insurance and disability income protection. If you are planning for your life insurance to match your beneficiaries’ expenses, a new child will add to those expenses. If you plan to save for your child’s education, life insurance can also assure completion of that plan.
– If you commuted regularly to your job, your mileage has likely plummeted in retirement. If so, you should report it to your auto insurer to significantly lower the cost of your premiums. Furthermore, drivers over the age of 50-55 may get a discount, depending on the insurance company.
Published with permission from RISMedia.