Home insurance is a crucial safeguard for your most valuable asset, but many homeowners are unknowingly underinsured. This means their current policy isn’t robust enough to cover the costs should they need to file a claim.
Signs Your Home Might Be Underinsured 
The following are signs your home might be underinsured:
- Minimum coverage—If you opted for the minimum recommended coverage to save money, you might not have enough to rebuild or replace your home in case of a total loss.
- No home inventory—Without a detailed inventory of your belongings, you might underestimate the value of your possessions, leading to insufficient personal property coverage.
- Rising costs—Construction costs and home values can increase over time. Your coverage might fall short if you haven’t updated your policy to reflect these changes.
Steps to Ensure Adequate Coverage
Take the following steps to help make sure you have adequate home insurance:
1. Conduct a home inventory. List all your belongings and their estimated values. This can help determine the right amount of personal property coverage.
2. Review and update your policy annually. Review your policy regularly with your insurance provider to reflect current construction costs and home values.
3. Choose replacement cost coverage. Opt for replacement cost coverage rather than actual cash value coverage. This can help you receive enough to rebuild your home with similar materials without depreciation.
4. Consider additional coverage. Evaluate whether you need extra coverage for specific risks such as floods or earthquakes, which are often not included in standard policies.
5. Increase liability coverage. Consider increasing liability coverage to better protect against potential lawsuits from accidents on your property.
Learn More
For home insurance near you, contact Gerhart, Hartman & Ritner.
This blog is intended for informational and educational use only. It is not exhaustive and should not be construed as legal advice. Please contact your insurance professional for further information.