5. Make sure you have enough coverage
According to Consumer Reports, 8% of homeowners who file claims find out that they’re underinsured. This is a bad place to be, and it can turn into a financial disaster if you’re not prepared.
For example, imagine that your beloved home burns to the ground. Although you paid $200,000 for your home, it’s going to cost significantly more to rebuild it because labor and material costs have gone up quite a bit in the three years since you took out your policy. It’s now going to cost at least $300,000 to rebuild – but your policy only covers a rebuild of $250,000.
Consumer Reports states that 60% of all homes in the U.S. are underinsured by 20% or more. This is why it is best to have a conversation with your agent every year to make sure that your coverage is adjusted to meet your needs.
