Is Your Homeowner's Insurance Policy Out of Date?

Your homeowners' insurance policy is one of those things that, after you purchase it, you rarely think about. In fact, if you're like most homeowners, it's probably the same policy that you purchased when you bought your home. When was the last time you pulled it out of the desk drawer and took a look at your coverages?
Here are five reasons your homeowner's insurance may be out of date:


If you're unsure of what damages are covered…
In general, most homeowners' policies cover a standard list of damages. Some of the types of damages covered by most policies include:

• Fire
• Hail
• Smoke
• Theft
• Falling objects
• Freezing

It's important to remember that threats to your home vary greatly according to the location of your home. If you live in a coastal region, flooding or hurricane damage may be of concern to you. On the other hand, if you live in California or Arizona, fires and dust storms might be more prevalent. It's important to know how you're protected if these types of natural disasters occur.


If your rates are climbing…
It's always a good idea to keep an eye on your insurance rates and to revisit the policy every year to ensure that you're still getting the best deal you can. Many homeowners often choose to consolidate several of their insurance policies to one carrier to get a better deal. If you've noticed your rates are increasing, do not be hesitant to shop around.


If you moved to a new location…
When you move to a new location, it's likely you're taking out a new mortgage and, therefore, new homeowners insurance will be required. Keep in mind that the coverages that you had in your previous policy may change at your new residence. Also, keep in mind that even if you move to a new home within the same city, coverages like flood insurance can change drastically from one street to the next. Always consult with an agent regarding any changes that need to be made to the policy.


If you made improvements…
You may be capped out at a certain amount of money on your homeowners' policy that does not take into account any major improvements you've made recently. If you are upgrading or have done major renovations on your home, you should update your policy to reflect the increased value of your home.


If you are rebuilding according to new building codes…
If your home is damaged and you are forced to rebuild, there may be new building codes in place that were not there when you initially took out your policy. Those changes may require you to spend more than you would have previously. Make sure that you are covered for those additional costs.
Your local builders' association will be able to tell you what changes may affect your homeowners' insurance policy and the cost to rebuild. As always, you should be able to get straightforward answers from your insurance agent about these and other questions before you renew or upgrade.


It pays to do your research
As with all things in life, it pays to do your research and to never accept the status quo for too long. Dust off that homeowners policy to make sure you're covered. Don't wait until it's too late!