The Importance Of An Annual Insurance Review

Christen Tucker

By: Christen Tucker


Summer is here! Barbecues. Fireworks. Vacations. Makes me think of….a review of homeowners and auto insurance coverage with your insurance agent! Not what you were thinking of? What if you are involved in a car accident on the way to the beach or an out-of-control barbecue chars your home! We hope that doesn’t happen, but are you covered if it did?

Many people view obtaining insurance coverage as a one-time task. Get it and forget it! However, that is not the case. Your old coverage may not suffice especially if you have recently renovated your home or purchased new furnishings, art, or other personal possessions. It is a good idea to make a home inventory and document the items you own. Gather receipts, bills, and brochures to help establish the price and age of everything that would need to be replaced or repaired. Photos and videos of the contents of your home are good documentation tools as well.

When you are ready to review your policy with your insurance agent, be sure to ask the following questions:

Is the coverage on your home and its contents adequate?

The home inventory will help with this. If you have any special items like art, jewelry, or collections (such as stamps or coins), mention them as well. These items may require special coverage.

Is your premium as low as you can expect it to be? Are there any additional discounts available? Can/Should you raise your deductible?

It is a good idea to consider raising your deductibles for losses you can afford to pay.

Are there any losses such as flood or earthquake that may be of concern and are not currently covered in your policy?

Neither flood nor earthquake are covered by standard homeowners policies.

Has anything changed in your coverage from last year?

Insurers may change policy terms at renewal, but they must notify you first. Ask your agent if there are any anticipated changes when the policy renews.

We also recommend that clients secure an umbrella policy to protect them from personal liability. If someone suffers a catastrophic injury on your property or your teenage driver rear-ends a school bus, you can be held liable for lost income, medical bills, and personal damages. While homeowners and auto policies include some coverage, an umbrella policy will protect you from having to sell your home or liquidate your savings if the unthinkable happens. Many insurance agents suggest that your umbrella coverage should roughly equal at least the same dollar amount as your net worth.

These things aren’t the fun part of summer, we know, but life may be a little less hectic this time of year, so it’s a good time to knock off a “need to do” task before you find out too late that your insurance isn’t what you thought.

Please let us know if you have any questions regarding your insurance policies.

Homrich Berg is a national independent wealth management firm that provides fiduciary, fee-only investment management and financial planning services, serving as the leader of the financial team for our clients.