When was the last time you took a look at your home insurance policy? Many times, it is very easy to just allow it to renew, year after year, without looking at it and the details within it. Yet, your home’s needs change. It is important to carefully consider the coverage you have. You also want to be sure you choose a policy that represents your specific risks. These change, too. Here is some insight into what you may need to update.
What Is Your Home’s Value?
You may know the value of your home if you sold it on the open market. However, the cost to rebuild your home is very different. It often tends to be significantly higher.
If you do not have enough home insurance to cover the cost to rebuild your home, that could cost you. You may not be able to rebuild the structure, for example, if the policy does not offer enough money to do so. Talk to a local home builder about the cost to rebuild your home. Your agent can help you determine this, too. Then, they can help you update your coverage as necessary.
What Enhancements Have You Made to the Home?
Another common oversight is knowing what type of enhancements or changes you made to your home over the last few months or years. Here are some that could impact the value of your home insurance policy:
- Room additions
- Finishing the basement
- Adding a bathroom
- Adding an attached garage
- Adding an outbuilding
- Changing the layout of the home
When you make significant changes to the structure of the home, be sure to let your agent know about this. It can make a difference in the coverage your policy has. This impacts the value your coverage needs. It also impacts the risk present for the insurance company.
Know Your Risks, Too
If you add a home security system or you install a new roof, that might help to lower your insurance costs. However, if you add a swimming pool or a hot tub, you could raise the risks. This can increase your needs for higher home insurance coverage.
It is important to look at your policy objectively. You want enough coverage to minimize financial loss should an accident occur. With the right home insurance policy, you do not have to worry about the financial loss if an incident occurs. You know that your home has protection to meet most risks.