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 Tammy 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 sound system, 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 help avoid any gaps in their
clients insurances. However, it's equally important 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
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. 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.