How Much Insurance is Enough? - Private Management Insurance Agency

How Much Insurance is Enough?

Buying homeowner’s insurance isn’t a matter of if but how much. You may be concerned about over-spending on homeowner’s insurance, but don’t skimp on what you need in case catastrophe strikes.

As the value of your home increases, so should the amount of coverage you have. Homes with higher-than-average value, luxury homes and vacation homes may have features that aren’t typical to standard houses. Your insurance should reflect these extras.

A standard, middle class home may not have such amenities as gourmet kitchens, swimming pools, exotic hardwood flooring and imported marble counters. As such, a standard homeowner’s insurance policy may not go above and beyond to cover these high-end comforts. The last thing you need is to experience a loss only to find that you don’t have adequate coverage.

There are a few ways to know if the insurance you have is sufficient. The most reliable and thorough choice is to have an appraisal done on your home. Insurance agencies that specialize in luxury home insurance may do this on your behalf. However, hiring a professional appraiser yourself is never a bad idea. Once you know the true value of your home it is much easier to determine the exact amount your homeowner’s insurance should cover.

A simpler and faster way to verify that your insurance is acceptable is to talk to your neighbors about their coverage. Arguably, homes in your neighborhood should have a similar value. It may be time to upgrade if your policy covers much less than your neighbors’ policies. However, this method only gives you a rough idea of what you might need. It is not nearly as accurate as a professional assessment.

You may have already had your home appraised in the past. Don’t simply go with that figure for years to come with the assumption that your home’s value has remained static. Over the course of time, it is natural for real estate values to change. Have you made any upgrades to your home? Are there new amenities in your neighborhood? Has the asking price for nearby homes gone up? Any of these changes likely mean your house’s value has gone up. Your insurance policy needs to follow suit.

Re-check your insurance policy each year to make sure you have the right amount of coverage at all times.

Private Management Insurance Agency is highly willing to offer whatever assistance you may need at each step of the quoting and transaction process. You can reach our customer service team on Monday through Friday from 9 am-5 pm PST— Call us at (858) 252-4111, or you can also set a schedule with us just by clicking here.

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