Is Your Insurance Policy Good Enough?
Did You Know?
Most homes in the USA are under-insured as building costs have risen dramatically in the past 2 years (at least 6.6%) due to a construction labor shortage as well as new tariffs on materials.
In 2018, 14 different natural disasters, from record-setting wildfires here in California to devastating hurricanes in Florida, cost the USA $91 billion according to the National Oceanic and Atmospheric Administration, the 8th consecutive year with at least 8 disasters in the billion-dollar range.
Under-insured properties pose a tremendous fiscal risk to individuals, communities, cities and states as they pose the potential for mortgage delinquencies and real estate tax delinquencies resulting from natural disasters.
Time for an Insurance Policy Check-Up?
If you're like me, you probably don't make it a regular practice to revisit the details of your insurance policy once you've paid your premium or come renewal time. Even as a Real Estate professional who regularly helps clients line up their insurance coverage, I have to admit that as long as my premium doesn't change much I tend to just renew at my expiration date and get on with life.
However, after watching last summer's wildfire tragedies across California, it definitely gave me pause to consider if my policy would pay out enough to allow me to rebuild at today's cost of materials and labor should I be unlucky enough for my home to fall victim to a natural disaster.
Have you reviewed your insurance coverage lately? If you haven't, I suggest that now is a great time to revisit and make sure your insurance policies reflect current building costs.
Not sure where to start? Ken Fisher (investor legend and founder of Fisher Investments) just published a great checklist in his sunday column in USA Today. Click here to check it out.