New Year, New Coverage

New Year, New Coverage

March 14, 2024

7 Tips for Reviewing and Updating Your Insurance Coverage

The new year is a good time to do a comprehensive review of your insurance. It is essential to examine it at least annually and, if necessary, modify your insurance plans for several reasons. Ideally you want to stay current on policy changes, and ensure your coverage still works for your needs and those of your family, especially when major life events occur like a marriage, purchasing a house, or a change in family size, and also to help save you money on unnecessary expenses.

Here are seven tips on how to conduct an insurance review:

1. Evaluate your current coverage

Things happen all the time as we navigate through life. We are often so busy when there is an event we may overlook things like reviewing our insurance. However, these events may spur a need for a change to your coverage and policy.

  • Review your policy type.
  • Update your contact info for your insurance carrier and insurance agent.
  • Ensure your policy number is accessible.
  • Keep track of the premium you pay and how often you pay it.
  • Evaluate who is covered under your insurance: you, your spouse, a dependent child, another family member.

2. Modify your coverage if necessary

There are life changes that occur that may be a reason for you to evaluate and update your insurance. Some of these include:

  • You have an addition to your family, for example, a new child
    • Health insurance
    • Life insurance
    • Auto insurance (if necessary)
  • You get married or experience a divorce
  • Health insurance
  • Auto insurance
  • Life insurance
  • Homeowner’s or renter’s insurance
  • You purchase a new home
  • Health insurance
  • Auto insurance (if you bundle home and auto)
  • You purchased a new car
  • Auto insurance
  • Homeowner’s insurance (if you bundle home and auto)
  • You made an expensive purchase
  • Homeowner’s or rental insurance (typically, coverage includes possessions)
  • You renovated your property
  • Homeowner’s insurance
  • You get a raise at work
  • Auto insurance
  • When you are considered a high-net-worth individual
    • Umbrella insurance (extra liability coverage of $1 million on top of your current auto and homeowner’s insurance).

3. Review your deductibles

Understanding how much you owe in deductibles and how your plan works may help you to consider how you use your healthcare services and potentially save on unnecessary costs.

4. Pursue discounts that could benefit you

Access to discounts varies per insurer. Some of the more common discounts include:

  • Military discount
  • Loyalty discount
  • Good driver discount
  • Student discount
  • Autopayment discount
  • Low-mileage discount

5. Look to mitigate the possibility of gaps in your coverage

It is essential to contact your insurance agent to ensure your policy doesn’t expire without you realizing it and discuss options to stay on top of it. Also, open all the mail you receive from the insurance company and review it; not all of it involves upselling, but some documents may be worth reviewing.

6. Review your beneficiaries

It is important to review your beneficiaries and to keep them updated as life changes. Also, keep in mind that the beneficiaries you had one year may be different from the ones you want now.

7. Consult a financial professional

When reviewing your insurance policy and the implications of how your financial decisions could impact your strategy and long-term goals, consider consulting a financial professional. According to a recent Northwestern Mutual 2022 Planning & Progress study, eight in 10 people who seek help from a financial professional say they were able to build their savings. Schedule that appointment today and work to ensure your decisions will align with your financial and retirement blueprint.

 

Important Disclosures:

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual.

All information is believed to be from reliable sources; however, LPL Financial makes no representation as to its completeness or accuracy.

Sources:

How Often Should I Review My Insurance Coverage? | Travelers Insurance

10 Life Changes that Call for an Insurance Evaluation - Ramsey (ramseysolutions.com)

This article was prepared by LPL Marketing Solutions

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