By Selective Insurance Company
The year 2021 saw the beginning of a marked boom in home improvement spending, as homebound Americans turned their attention to enhancing their residences. A survey commissioned by Selective and conducted by The Harris Poll found that over half (55%) of US homeowners said they had made home improvements that increased their home's value. If you have recently updated your home in any way, we recommend you review your insurance policy and call your independent insurance agent at the earliest opportunity.
The Selective study also found that only 66% of homeowners who had made home improvements had updated their home insurance, meaning that the remaining 34% could discover that they may not be fully covered if a loss occurs.
In our experience, homeowners who have upgraded their dwellings sometimes hesitate to call their insurance agents out of concerns that their premiums might increase. The fact is, home improvements don't always lead to higher premiums. It's true that some types of improvements, like a kitchen remodel, will raise the value of your home. But there are many other improvements, like a new roof or home security system, which could reduce your insurance costs.
Your agent is the best source of advice on how various home improvements may impact your premium.
Other Events That Should Trigger a Homeowners Policy Review Home improvement isn't the only reason to review your policy. In a year characterized by life-altering upheavals, think of all the changes that may have occurred in your home:
You're at home more often than not
You're using company-issued equipment to work from home
There are more people than usual living under your roof
You bought high-ticket items, like jewelry, or installed a security system
Changes like these affect your insurance needs, which is why we suggest taking inventory of all modifications to your home and talking to your agent. After a loss is not the right time to discover that you do not have the right coverage. Your agent can help you update your policy so you're protected when it matters.
The best time to review your insurance is anytime you make changes like the ones described above, or at the least, 30 to 60 days before your policy's renewal date. If your coverage is complicated, talk to your agent closer to 60 days before renewal. One benefit of starting the process sooner: you may receive an advanced quote discount. Selective is one of the companies that offers this discount to new Personal Lines customers.
How to Review Your Policy Begin by reviewing these three areas in your homeowners policy: the replacement value of your home (not the same as its market value), the contents in your home, and any scheduled specialty items.
Your insurance agent can help you determine the replacement value of your dwelling. Carefully estimate the replacement value of your home's contents. Some insurance companies automatically apply a percentage of the home value to establish a contents value, which may leave you over- or under-insured. Finally, specialty items like jewelry, watches, or other valuable items may not be part of the standard contents coverage, so you should obtain special coverage for them.
Transparency Has Value A final piece of advice we'd like to offer about reviewing your homeowners insurance policy with your agent: Be transparent about anything that could affect premiums. Your agent's job is to get you the best coverage at the best price. The more they know about your home improvements and life changes, the better they can advise you and help protect you from expensive surprises if you need to file a claim down the road.
Count on JLA for Homeowners (and Auto) Insurance!
If you need assistance with your personal insurance needs, please contact us today! The reason we chose to be an Independent Insurance Agency is so we can provide you with multiple options. We recognize that everyone's situation is different and the ability to contact multiple insurance carriers helps us tailor a policy specifically for your business. Our team is waiting to provide expert guidance and advice.
