Your home insurance renewal statement has arrived through the mail slot. But before you sign on the dotted line and seal it back up, there are some important things you may want to consider.
first thing’s first: go over your homeowners insurance renewal statement
It goes without saying that your house is one of the largest and most important investments you'll ever make. Therefore, it's important that you make sure your homeowners insurance policy is up to date.
Most home insurance policies last for one year, and renewal statements are typically sent out before the policy is set to expire. If you don't object or cancel, and simply pay the bill, your insurance company will probably automatically renew the policy. With that in mind, it's easy to see how many homeowners don't pay attention to the statement, especially if payment is handled by their escrow company.
The statement provides an update of your current coverage limits and your deductibles. Think of it as an opportunity to perform an annual checkup on your policy (sans stethoscope) to take stock of what you own or have, and to make sure that your coverage adequately reflects your assets.
When reviewing your home insurance renewal statement, be sure to check the basics like addresses, the people listed under your policy, and that your coverages and deductibles are accurate. Then you can determine whether protection is good as is, or needs some tweaks here and there to account for any changes in your circumstances.
Whether you decide to renew your policy or change to another company, it's vital that you take action in order to avoid a lapse in coverage.
are you covered for any changes in the home?
When reviewing your renewal statement, it's important to examine your coverage, and consider any necessary adjustments. Some things to consider could include:
Have you added a room for a new family member? Does the bathroom have upgraded, spa-like amenities? Has the square footage of the home increased? When it's time to renew home insurance, make sure your policy is adjusted to reflect those improvements, because the value of your home has likely increased.
If you shirk reporting these renovations, you run the serious risk of not having enough protection — after all, disaster rears its ugly head when you least expect it to.
Don't overlook unattached structures outside, either. Swimming pools, hot tubs, and gazebos could also affect the value of your home and, therefore, impact your homeowners insurance renewal.
Bear in mind that if you have purchased new furniture, like a 60-inch flat screen, gym equipment, a computer, or any other home furnishings, it may behoove you to increase the amount of protection you have on your personal belongings.
Consider taking a regular home inventory to better gauge the amount of insurance you could consider.
Bear in mind that homeowners insurance usually limits coverage to personal possessions, which could cause some insurance complications for your in-home business items.
If you're a one person operation, you may be able to expand your existing policy to protect your business. Other options include buying a separate business owners policy.
have there been any major life changes?
Life is full of momentous changes. And with these changes come lifestyle adjustments. As you continue to grow and evolve, the assets protected under your homeowners insurance policy could also be affected.
A new family member
If you've had a recent new addition to the family, you've likely taken measures to "baby proof" the home — whether it's installing window guards or implementing safety gates around unsafe areas of the house. It's important to notify your insurance company of any measures you have taken to reduce liability.
If you are merging households to share a new life with a significant other, make sure to update your homeowners insurance so that it accommodates the new total value of your belongings. Likewise, if you are sharing the household with in-laws, you only need one policy to cover your possessions.
Paid off mortgage
Paying off your mortgage is a pivotal occasion, and now that you're in the pantheon of homeownership, you may be able to enjoy the fruits of having leeway in your policy. With that being said, check out the coverage your mortgage lender required of you, and see if changing that coverage could be an option.
has your renewal rate changed?
Upon reading your renewal statement, you may be overcome with sticker shock to see that your rates have jumped. Perhaps you have never filed a claim, or missed a payment — you're a paragon of homeowner excellence. So, what's the deal?
There are several factors that contribute to premium increases — from inclement weather and forest fires (which have worsened in the last 10 years) to increased burglaries in your neighborhood. While these external forces are frustratingly beyond control, they mean greater risks for you, your home, and all of your possessions.
Sometimes, however, rates can go down, especially if you've outfitted your home with safety features, such as storm shutters, carbon monoxide and smoke detectors, and utility upgrades to reduce fire hazards. Here are some other ways to tamp down those premiums.
Consider your deductibles
If you have a secured emergency fund tucked away in your savings account, you could consider raising your homeowners insurance deductibles, which is a simple way to lower your premium.
But if you feel more comfortable knowing that you won't have to pay a higher amount out-of-pocket should you need to file a claim, then it may be fine to keep your deductible right where it is.
Take care of routine maintenance
By replacing worn rubber hoses on your washing machine, and investigating any possible leaks in your faucets, you are taking a simple — and considerable — step toward preventing major water damage to the home. Little preventative measures, like ensuring your drain pipes are in good condition and inspecting your shingles for signs of weather damage, can greatly reduce the risk of catastrophic damage.
Bundle your home and auto policies
Some companies — like Esurance — offer discounts if you bundle home and auto insurance. Not only could you save money, you'll also avoid the hassle of scrounging around for important information and documents to pay bills or file a claim with different companies.
what if your homeowners insurance is not renewed?
Getting dropped by your insurance company is never fun, but don't panic. In many states, it is mandated that your homeowners insurance company at least give notice ahead of time, so that you can look for a new insurer.
In Massachusetts, for example, insurance companies have to give you a heads up at least 45 days before your policy's expiration date. This is especially critical if you have a mortgage, as they most likely require you to have homeowners insurance.
On the other hand, maybe it was your choice not to renew your policy. Maybe it's time to start anew with a homeowners insurance company that is more attune to your wants. Savvy homeowners and home buyers should always shop around, compare policies, and do research when scouting for companies.
And, you can begin with us. Speak with our licensed agents at 1-866-439-5633 or get a free Esurance homeowners insurance quote online to help get yourself started on the right foot.
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