Should existing homeowners insurance coverage be reviewed?

Reviewing an existing homeowners insurance policy

Choosing homeowners insurance can feel like a daunting task. But once the homeowner is insured, the policy still needs to be reviewed, in order to make sure it provides enough protection for the current value of the home and possessions, and still addresses the risks that homeowner faces.

The best time to review home insurance is when the insurance company sends the renewal notice. In that letter, the company will explain any changes to the policy or coverage, and it’s important to ensure the policy still meet the homeowner’s needs.

At that time, the homeowner should also review the deductible – if the financial situation has changed, this is a good time to think about getting a higher or lower deductible to help with the premium payments. Additionally, if there are significant new personal possessions-such as computer equipment or fine art-the coverage may need some adjustment.

Another good time to review the insurance policy is after any major change, such as:

• A renovation or an addition that is either part of the existing home or is a new structure on the property.
• Starting a business in the home, which may require additional coverage for various reasons.
• An improvement that improves the safety of the home or property, like an alarm system.
• The purchase of an expensive item like artwork or jewelry
• A major lifestyle change such as a divorce or marriage