As a new year begins, it is the perfect time to stop what you’re doing and take a nice long look at your insurance picture. A lot can change in the course of a single year. Life events, financial circumstances, and your plans for the future can all have a huge impact on your insurance big picture, which makes a policy review a good choice for you before you dive into the chaos a new year can bring.
What Has Changed in Your Life Since Your Last Insurance Review?
A good recommendation is to conduct a policy review at least once a year. Unfortunately, far too few people follow this important rule of thumb. These are a few of the things that can change in the course of a year that will greatly impact your insurance needs:
- The birth or adoption of a child.
- Death of a spouse.
- Major move.
- Change of marital status.
- Significant weight loss.
- Prolonged illness.
- Opened a new business.
- Received an inheritance.
- Purchased or sold a home.
- Empty nest.
- Bought or sold/traded in a vehicle.
- Paid off your mortgage.
- Started a home business.
- Began a “side hustle” like a ride or home sharing business.
- Changed jobs.
- Began caring for elderly parents.
The list could go on and on. The bottom line is that the changes in your life can affect the types of insurance coverage you need, the amounts of insurance protection you require, and your risks. More importantly, some changes could, potentially, negate your existing insurance coverage requiring you to purchase a different type of coverage instead.
Why are Insurance Reviews Necessary?
There are two reasons you need to conduct frequent, at least annually, insurance policy reviews.
- To make sure you have sufficient coverage to protect your financial interests.
- To ensure you aren’t paying for insurance protection you no longer need.
For instance, if you no longer have a mortgage payment, you no longer need to carry as much protection on your home. You may wish to continue maintaining maximum protection for your home, but it certainly is no longer necessary as losing your home to a covered event will no longer leave you repaying a mortgage company and replacing your home.
That doesn’t mean you need no protection for your home, especially since your home insurance policy provides you with essential liability protection if someone is injured on your property. It does mean you may require less protection for your home.
If you have young children, new babies, or parents who live in your home, you may need additional protection. Not just for your home insurance, but also when it comes to things like life insurance. Plus, if you have a teen driver in your home, you need additional auto insurance protection.
As you can see, little changes in your life can net big changes in your insurance coverage and protection needs. Contact Bates Hewett & Floyd today discuss changing life circumstances and to assess your current protection.
