Absolutely. Not everyone’s policy will need to be updated annually. However, it’s a good idea to review your homeowner’s policy needs when you obtain new art objects, for example, jewelry and hobby items like rare train sets or 100-year-old porcelain dolls.
It’s not just about expensive things like classic cars or retro travel trailers. It’s also about the structure and any add-ons such as an extra room, indoor or outdoor pool, a deck, a bay window, or adding a permanent canopy over the patio to make an outdoor room. Toney Insurance Services of Snellville, GA is here to explain why this assessment is necessary.
The 80 Percent Rule
You just left closing on your new house with only change left in the bank. You had to purchase home insurance for closing. We get it. You should know, though, that the 80 percent rule is necessary for homeowners to receive full home insurance coverage.
You should also know that had you not bought it and/or kept up with inflation to keep your insurance at 80 percent and a disaster struck, then the insurance would only pay the difference between the 80 percent of the value of the house and the amount of insurance you bought.
Why Update Your Home Insurance
Let’s say your new house needs upgrades. You upgrade it, and the value of your home increases. The snag to that is you forgot to upgrade your home insurance. Disaster strikes. The insurance company won’t pay for repairs because the 80 percent window has been closed.
According to the upgraded value of your house, you now have, say, 58 percent coverage on your house. The insurance company will take the difference between the 80 percent it originally was and the 58 percent it is now and pay you 22 percent. You’re on the hook for the rest of it. Toney Insurance Services in Snellville, GA will be happy to walk you through what other things you should know about home insurance.
