The importance of insurance reviews
Most people turn to their insurance brokers or underwriters when there’s a major life event that necessitates new or revised risk coverage—perhaps when they’re buying a new home or it’s time to replace that old car. However, far fewer remember to review their insurance at regular intervals or when more subtle changes occur to their coverage requirements.
Regularly reviewing your insurance helps ensure that your cover is what you expect it to be in the unfortunate event that you do have to make a claim. It also helps in making informed decisions about coverage and being proactive to minimize your insurance costs.
There are many different circumstances that could change your coverage requirements and prompt you to call an insurance professional for a review. The examples below identify some of the cases where you may want to review your coverage:
- Repairs – If you are renovating your house, you are likely to increase its value as well. Whether it’s a new kitchen, bathroom, pool or even expensive landscaping, be sure to check your policy limits to ensure they remain adequate in the event of an insured loss. If you’ve recently renovated your basement, also keep in mind that it’s quite likely that your water damage insurance needs to be reviewed.
- You have accumulated things – Have you done a home inventory lately? Most people have more personal belongings than they think. Assessing the overall value of your content is vital to ensure your limits are adequate.
- You have purchased a high value item – Remember that some of your personal items need to be planned to be properly covered. Jewelry, antiques, collectibles, wine collections, and art are a few examples of items that may require additional coverage.
- New finishes available – The insurance industry often adapts to changing market conditions and offers coverage in areas it has not done in the past. For homeowners, insurance for land-based water damage and home repair issues (such as damaged furnaces) has recently become available from some insurers in some areas. In addition, legal expenses insurance, travel insurance and pet insurance are available from brokers who want to cover more of your risks and insurance needs.
- Laws change to give you more or less choice – Changes to car accident benefits mean you need to reconsider your choices.
- Eligible for additional discounts – Changes in your personal circumstances may affect your eligibility for policy discounts. For example, if you install an alarm system, you may be eligible for a rebate on your homeowner’s policy. If you use winter tires on your car, many insurers offer a discount on your car insurance policy. If you are aged 50-55, you may be eligible for mature driver discounts.
- If you change your job and commute shorter – You should communicate this to your insurance broker, as driving less usually correlates with lower risk and cheaper premiums. If you have a certain occupation, you may also qualify for lower insurance rates.
- You started a home business – Other uses of your home other than strictly residential may require business insurance to properly cover liability risks.
- Your personal circumstances change – If you get married or have children, you may want to review your coverage to ensure your coverage levels are sufficient to take care of your dependents in the event of an accident.
- Your child gets a driver’s license – Always check if your child can be added to your policy. It is often the cheapest option for driving insurance. If they get their own car, you’re also likely eligible for a multi-car discount.
- If your child moves to attend college or university – Check to see if your homeowners coverage can be extended to protect your child’s assets while they are at school. It may be more cost-effective than purchasing a stand-alone renters insurance policy.
- If you have not had an insurance review for more than a year – Your coverage levels may be out of date. A key example of this is your home insurance. Property values and replacement costs can easily rise to the point where your existing coverage limits do not allow for the complete reconstruction of your home in the event of a total loss.
Taking the time to speak with your insurance professional is always time well spent. Even if you don’t save on your insurance costs after the call, nothing can replace the coverage you expect when a claim becomes necessary. Since most insurance policies are for one year, it’s a good idea to talk to your insurance professional before renewing your annual coverage.
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