When was the last time you reviewed your insurance policy? If you are like most homeowners, that might be well, never. But when you don’t know what you are covered for and what you are not covered for, the result can be insurance gaps that leave you hanging in the event of a claim.
Here are three other reasons you should review your insurance policy:
Your property’s location may be susceptible to earthquake or flood.
Each property has its own unique risks, and depending on where your property is located, earthquakes and floods can be among them. Yet these two items are specifically excluded from a standard property insurance policy, and often this comes as a surprise to property owners in the aftermath of a disaster.
You have started working from home.
Most people don’t realize that while working from home is great, it is also something that should be covered in your insurance policy. Consider, for example, that you have a home office with a computer, software, and files, totaling $5000 in value. Most insurance companies only allow for $2500 in value in home office supplies on a home insurance policy. So in the event that these items are damaged or stolen, their full value would not be covered. As another example, let’s say you store items in your home that are used for your work. If these are not reflected on your insurance policy, potentially, they also would not be covered in the event of a loss. Here again, homeowners can be in for a big shock in the event of a claim.
You have made changes to your property within the last year.
It is rare that no changes to a property have been made within the last year, especially when these changes including personal affects such as new furniture, electronics, artwork, and even jewelry. Yet, sadly, most homeowners don’t realize that unless they update their policy, these things will not be covered. In the case of a theft, this often comes as a shock to homeowners. Or, in another example, if renovations were made that were not reflected in the insurance policy and then were subsequently damaged, they also would not be covered.
It pays to update your insurance policy yearly. When you don’t, you can be left vastly underinsured and settling for an inadequate amount in the event of a property damage insurance claim.
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