Most people know the importance of insurance protection. You don’t want to be without it when problems strike. What many don’t realize, however, is that protecting themselves with insurance isn’t a once and done event. You don’t wear the same pants you did when you were five years old because, besides no longer being in style, they simply don’t fit. A homeowner’s policy purchased when your house was furnished with bean bag chairs and bar stools is no longer going to “fit” once you’re lounging on Italian leather sofas while watching television on your wall mounted plasma screen. Life is constantly changing, and your insurance policies should reflect that.
Does this mean that I have to immediately call my insurance agent every time I buy a new piece of furniture or my cousin Gwen moves in for 6 months? Not necessarily. While more significant changes should be reported immediately (such as getting married or getting a new car), items such as improving your home entertainment system or upgrading your car’s tape deck to an mp3 player, can be reported at your annual insurance review. Agents reach out to their clients because they want to make sure to check up on these changes and make help avoid any gaps in their clients insurances, however it’s equally important to for a policyholder to reach out to their agent to make sure they are covered. Schedule your own annual review, and call your agent as you get your annual renewal. If one agent handles all of your coverage, this task is relatively easy. Jot down any changes that have occurred over the last year, even if you’re not sure whether they are significant enough to mention. Doing so will ensure that all of your insurance policies are best suited to your current life situation.
Some examples of changes that should be mentioned to your agent immediately are listed below. Ask yourself these questions every year:
*Have I gotten married or divorced?
*Have I had a new baby, or adopted a child?
*Is anyone in my house a new driver?
*Is anyone living with me who wasn’t before? Will they ever be driving any of my vehicles?
*Do I have a personal umbrella policy? Do I need one?
*Have I purchased any new properties?
*Have I started a home business?
*Have I purchased new furniture, electronics, or fine jewelry?
These are just a few examples of life changes that are often picked up during an annual review. However, they are far from the only changes that can affect your coverage, so be thorough when documenting and reporting items to your agent.
Some of the above examples might seem pretty obvious. Most people know that if their teen-ager gets his license, they need to notify their auto insurance carrier. However, not everything is as obvious. For example, take a couple who just had their first child. They decide that it’s time to purchase life insurance to provide for the child if something ever happens to them. This couple is doing the responsible thing. They understand the importance of buying life insurance when starting a family. That significant step in planning for the future is taught to the general public quite effectively, in the form of commercials, television shows, radio spots, and the like. But what about five years later when little Ellie is born? Having child number 2 doesn’t necessarily flip on the proverbial switch like the first time, shining that bright light on the right decision. Television shows don’t show “made for t.v.” couples updating their life insurance policies for child number 2. Advertisements don’t highlight the importance of adding new children as beneficiaries. All anyone ever hears about through popular culture is the importance of getting life insurance if you don’t have it, especially if you are starting a family. If the Henderson family gets a life insurance policy when their first little one is born, and 4 children later, mom and dad are hit by a logging truck on a trip to Alaska, only #1 gets the money. Unfortunately, #1 also happens to be 18 by that time, and decides to run to Vegas with his new fortune. This particular tale might seem slightly “tall,” but beneficiary issues create havoc, legal battles, and misdirected money on a daily basis. Sometimes it’s to the tune of thousands, other times it’s to the tune of millions. Protect yourself, your family, and your personal belongings by making sure that each of your insurance policies gets an annual check-up. You’ll rest much better once you do.