Signs it's time to re-evaluate your home insurance

Yahoo Homes

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Think you're paying too much for home insurance? Now could be the perfect time to see if you can find a lower rate elsewhere.

In fact, you might want to make reviewing your home insurance policy a yearly habit.

Things change, says Loretta Worters, vice president of the Insurance Information Institute. So "it's important to re-evaluate your home insurance policy annually," says Worters.

Keep reading for signs it's time to update your policy...

Sign #1: You've Had a Major Lifestyle Change

If your relationship or family status evolved, you might want to consider revising your home insurance policy.

Lifestyle changes - like getting married or divorced - are just two instances that could signal it's time to re-evaluate your home insurance.

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Merging two households is another example of a situation in which you may need to update your insurance, says Worters.

Getting divorced also may necessitate a policy update. If you move to a smaller home after, for example, you may need to set up separate home insurance policies from your ex-spouse, says Worters.

Then there's adding more people to your household. Adult children moving back home? "You may need additional coverage if there is a sizable increase in the value of the belongings in your home," says the III website.

Sign #2: You've Gotten New Valuable Possessions

Did you know that your valuable personal property - like appliances, artwork, electronics, jewelry, or collectibles - can be protected in a homeowner insurance policy? It's true.

"If you have purchased art or other expensive items, find out whether you should purchase additional coverage in the form of a floater or endorsement," says Worters. "This is an individual policy for expensive items that provides a higher level of insurance coverage."

It's especially important to remember to take note of your important possessions if you have received valuable gifts. For instance, if you have just gotten married, Worters recommends protecting wedding gifts and wedding and engagement rings.

To properly insure your valuables, your insurance agent will need some information from you.

So here are a few tips to help: "Start by making a list of your possessions, describing each item, and noting where you bought it and its make and model," says Worters. "Clip to your list any sales receipts, purchase contracts, and appraisals you have."

Sign #3: You've Added Safety Features to Your Home

Sign number four that it may be time to update your policy: If you've recently made safety updates to your home.

"You may qualify for a discount of at least 5 percent if you installed stronger doors, smoke detectors, a burglar alarm, or dead-bolt locks," says Worters.

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"Some companies may cut your premiums by as much as 15 or 20 percent if you install a sophisticated sprinkler system and a fire and burglar alarm that rings at the police, fire, or other remote monitoring stations," she adds.

According to Worters, other safety-related home improvements that could lead to decreased insurance costs include:

  • Updating the heating, plumbing, or electrical systems
  • Adding storm shutters or shatter-proof glass
  • Reinforcing your roof or purchasing stronger roofing materials

Sign #4: You've Remodeled Your Home

If you've recently remodeled your home, look into updating your policy to ensure you have enough coverage. For example, if you added a new room or expanded a kitchen or bathroom, the extra square footage might not be included in your home insurance policy.

"After a major renovation, you may need to increase the amount of insurance you have," says Worters. "Make sure that your insurance company knows about the improvements to your home."

Adds Worters, "be prepared to forward all records and receipts to your insurance company so that they can accurately assess your insurance needs."

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