For the New Year, as people reevaluate their life insurance needs, they should also review their homeowners insurance policies to make sure they have enough coverage.
Additionally, homeowners should consider winterizing and weatherproofing their home to avoid claims from snow, ice, or freezing pipes.
Because homeowners insurance is not required — unless by a mortgage lender — sometimes homeowners don’t have high enough liability limits to protect their assets, according to Bill Martin, president and CEO at Plymouth Rock Home Assurance.
An annual checkup and inventory of your policy coverage can help you stay on top of your insurance needs so you don’t end up without coverage.
Here’s a new year checklist to make sure you are getting the most out of your homeowners insurance.
1. Review your current homeowners insurance policy
Martin said that the main goal of homeowners insurance is to replace or rebuild your home if it is damaged. Dwelling coverage is the part of homeowners insurance that addresses replacing or rebuilding your home. He notes that if you made renovations or improvements last year that increased your home value, your limits should be reviewed and increased to reflect that.
Martin recommends that considering how much would it cost to rebuild if a fire burned the house. He said the cost to rebuild should also consider the cost of materials (lumber) and labor have gone increased.
Martin recommends updating your home inventory list and reviewing it with your agent to make sure your limits are high enough to cover replacement costs.
If you received high-value presents during the holidays, does your policy cover it, or do you need to increase your personal property and personal liability limits? Martin noted that expensive gifts that are damaged, stolen, or lost from your home may be covered, but there are limits (like with expensive jewelry).
2. Review your add-on rider coverage
Because homeowners insurance is not required by law, most people only get what’s required by their mortgage lender or condo association. However, if you live in areas where natural disasters occur, you may need extra coverage.
Martin said that unless homeowners live in a designated flood zone, they are not required to have flood insurance. However, he noted that last year the majority of flood claims were from people that didn’t live in flood zones and they were not covered under their homeowners insurance because flood insurance is optional coverage.
Martin said that when thinking about optional add-on coverage like flood insurance or pet insurance, do not focus on whether it has happened before. He said instead the concern should be about claims that could happen in the future. If you don’t already have coverage when “it hasn’t happened before” actually happens, you will pay out of pocket.
Emergency Readiness Supplies from NYC Fire Dept
3. Instead of separate policies, consider combining them
Martin said that it can take a bit longer to find the right homeowners insurance provider and policy so people tend to get separate policies for pets, special jewelry, and high-value objects. He notes that homeowners insurance offers several add-on coverages like pet insurance and special jewelry so there’s no need to have separate policies.
It may also be cheaper to have a single policy. Martin suggests asking, “What optional coverage is out there and what riders could save money?” This is a conversation homeowners should have with their agent.
4. Make sure your home is weatherproofed
Martin noted that in the winter, homeowners in cold-weather states see damage from insurance perils like the polar vortex or the buildup of ice and snow that cause damage or accidents.
Martin said that many claims in winter are due to ice damage. If you don’t have the tools to remove snow and ice from your roof or shingles, you should have a contractor do it, as this is cheaper than having a leaking roof or damaged gutters.
He warned that homeowners are considered negligent for not clearing and removing snow or ice from sidewalks and driveways, which can lead to a personal liability claim.
5. Have an emergency “go bag” prepared
It is best to have an emergency go bag packed that includes a thumb/flash drive with important documents scanned (birth certificates, copies of passport, driver’s license, medical records, estates documents, photos, etc). Have a first aid kit and a list of your medication with a supply to last at least a week.
If your homeowners insurance company hasn’t provided the level of service you expected, maybe it’s time to select a new provider.
Emergency Go Bag from NYC Fire Dept
Ronda is an attorney, writer, and entrepreneur. She is a contributing writer for the Huffington Post. Originally from Chicago, she has lived in Los Angeles and New York. She loves to travel and is passionate about education equity, especially for first generation college students.