Why You Should Update Your Buildings and Contents Insurance
There is so much to do when you are buying a home that the priority for buildings and contents insurance coverage is most likely just not there. It is just one more thing on your to do list of things that are required in order to qualify for your mortgage, that as long as you have a policy to meet the requirement, that is good enough. Once all the mayhem of the closing and moving in and selling your old home is just another page of history, it is time to sit down and take a good look at just what your buildings and contents policy covers, or more importantly, what it doesn?t cover. Don?t make the mistake of just letting it ride year after year with all the thought of it being just one more bill you have to pay in order to stay in the house. Make your insurance policy work for you and give you the coverage you need.
The amount of your investment in your home should be enough to make you want to be sure that you are adequately covered for your entire property and all your belongings that you worked so hard to get. The list of things that can go wrong is a long and scary one, and includes such things as fire, storms, falling trees and floods. You may need to put in a claim someday for something minor, or you could end up having to replace, or rebuild everything. This is the reason it is so important to make sure that your policy is not just going to pay you for the current value of the insured items, but that it is updated and will pay you the cost to replace or rebuild everything completely from scratch. You many also want to check and make sure that additional structures on your property are covered for replacement as well, such as your brand new swimming pool, garages, patios, storage buildings, tennis courts and fences, as well as the contents they hold.
Since your situation is constantly changing, as is the replacement value of your property, it is important that you make sure your policy is updated frequently to accommodate the changes. You definitely want to make sure that your coverage is at least equal to or greater than what it will cost you to replace. You may be able to include in your policy an automatic rate of inflation increase that will help keep you up to date, but you will still need to continue to update your coverage on a consistent basis.
Research on insurance coverage indicates that the majority of people are covered for a lot less than the contents of their homes are worth, leaving them frustrated and disappointed if they ever need to file a claim. Under estimating the value of your buildings and contents is one of the biggest insurance mistakes people make, because they may get paid on a claim, but will not get enough to actually replace the items that were lost or damaged. Making sure you have enough buildings and contents coverage is well worth the time and effort you spend to be able to rebuild your life after disaster strikes. It is also very good to know that you can extend buildings and contents coverage to personal items outside of your primary place of residence as well.
It is too late once a disaster hits to do anything at all about your insurance coverage, which is why it is so important to do it now, and update often. Put it in your long term plan to do an overhaul on your buildings and contents coverage once a year, and make a note to append you policy when you increase the value of your home, or make major purchases of contents. Doing it now will pay off should the need to file a claim ever happen to you.
Susan Reynolds is a content coordinator for a leading South African Insurance Provider that specialises in Household Insurance Policies.
