The Importance of an Annual Insurance Review
If you’ve been paying your premiums but not doing an annual insurance review, you may have a blind spot in your coverage.
A lot can happen in a single year, and meeting with your insurance agent may have not made the top of your personal to-do list. However, if you or your family experience life, home, or auto changes, meet those changes with commensurate insurance adjustments. This may make the difference between overcoming a financial disaster or experiencing serious money problems.
June 28 is National Insurance Awareness Day, and it’s a perfect time to examine your insurance with a professional insurance expert like an agent from Farm Bureau Insurance. During this meeting, you’ll examine your current coverages to find gaps as well as identify potential savings.
During Your Review
During the course of a year, life changes such as birth, death, job change, and salary adjustment may occur. These changes may affect the strength of your life insurance policy. It’s important to go over those changes so that your life insurance policy is providing you the greatest benefit.
The National Association of Insurance Commissioners suggests that consumers ask the following questions about their policy:
- Do premiums or benefits vary from year to year?
- How much do the benefits build up in the policy?
- What part of the premiums or benefits is not guaranteed?
- What is the effect of interest on money paid and received at different times on the policy?
- In what situations and through what procedures can you assess cash values?
- Can the policy be converted into another form of insurance or annuity?
If you have a new car, an aging car, or a new driver, you may need to update your car insurance to adequately reflect your coverage needs. You may also qualify for a number of discounts.
The Family Financial Education Foundation offers these questions to bring up with your agent:
Have I had a significant life event such as marriage or divorce?
Car insurance premiums are generally lower if you are older and married, so birthdays and matrimony are likely to save you money, but getting a divorce may make your premiums go up. Be sure to keep your agent apprised of any significant life event.
Am I adding a new driver?
Adding a teen to your policy can be expensive, but you can still find ways to save. For qualifying drivers under age 22, Driver Training Discount is available and can reduce your premiums. Also, teens that keep B average or higher grades usually cost less to insure.
Have there been any changes in employment or residence?
Depending on whether vehicle is used for business vs. personal use, a change of employment may impact your auto rating. Be sure to update your agent with these changes.
Where you live will also affect your premiums, with urban or densely populated areas usually paying more. Crime rate and weather will also have an impact on what you pay.
The value of your home may have changed. Your homeowners insurance policy should always accurately reflect the value of your home. The Insurance Information Institute suggests reviewing your homeowners insurance policy:
If you have made major improvements to your home, such as adding a new room, enclosing a porch or expanding a kitchen or bathroom, you risk being underinsured if you don’t report the increase in square footage to your insurance company.
Don’t forget about new structures outside of your home. If you have built a gazebo, a new shed for your tools or installed a pool or hot tub, you need to speak to your agent. Keep receipts and records in case you need to forward copies to your company.
Schedule Your Insurance Review
Regular insurance reviews are the best way to ensure you are prepared in the event of a claim.You will never regret having properly prepared and updated insurance policies. An added benefit to an annual review is the peace of mind you’ll obtain with knowing your family is financially protected. To schedule your annual insurance review, contact your local Farm Bureau Insurance agent.