A lot can change in a year. You may purchase a home or vehicle, complete renovations, add a new driver to the household, grow your savings and investments, or find yourself in a very different financial position than you were a year ago. Your insurance coverage needs to keep pace with those changes.
An annual insurance review with your agent is an opportunity to make sure your coverage still reflects your life today. These reviews should be complimentary and should involve much more than simply discussing your premium. The conversation should include changes in your household, property, assets, and potential liability exposure.
Liability coverage is an especially important part of that conversation. We often think about insurance as a way to protect our homes, cars, and other property. Just as important is protecting the assets we have worked hard to build.
A serious accident or injury for which you are held responsible can potentially result in damages that exceed the liability limits of a home or auto policy. Reviewing your assets and current liability limits can help determine whether you have an appropriate level of protection for your financial situation.
This is also a good time to discuss personal umbrella coverage. An umbrella policy provides an additional layer of liability protection above certain underlying policies, such as home and auto insurance. As your income, savings, investments, property, and other assets grow, liability limits selected years ago may no longer provide the level of protection you need today.
No insurance policy can guarantee that personal assets will never be involved following a major claim or lawsuit. However, appropriate liability limits and umbrella coverage can provide an important additional layer of financial protection if you are held legally responsible for a significant loss.
An annual review should also look at what you own and what has changed. Have you purchased or inherited jewelry, artwork, collectibles, or other valuable property? Renovated or added onto your home? Purchased a boat, RV, motorcycle, ATV, golf cart, or other recreational vehicle? Acquired a vacation home, rental property, or other real estate investment? These additions can bring new insurance needs and additional liability exposures that should be part of the conversation.
Changes in how you live can matter, too. Perhaps you are now working from home, have started a home-based business, are renting out part of your property, or someone has moved into or out of your household. Even changes that may not seem insurance-related can affect your coverage, which is why keeping your agent informed is so important.
Price matters, but it should never be the only consideration when evaluating insurance. Understanding what your policies cover, where your limits are, and where you may have financial exposure is equally important.
Once a year, make time for a conversation with your insurance agent. Ask questions, discuss what has changed, and understand the protection you have in place. The goal isn’t simply to have insurance. It’s to make sure your insurance still protects the life you’ve built.
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