Protect Your Financial Security with Regular Reviews of Your Insurance Coverage
Picture this: After an unexpected storm damages your new home, you find your homeowner’s insurance doesn’t cover recent renovations. Situations like this are all too common for people who haven’t reviewed their insurance coverage in years.
Insurance isn’t just a one-time purchase; it’s a dynamic part of your financial safety net that needs routine care and attention. Insurance is one of the cornerstones of a sound financial plan, offering protection against unexpected events that could otherwise derail your long-term goals. However, simply purchasing a policy and forgetting about it is not enough. Insurance reviews are a critical, but often overlooked, aspect of maintaining appropriate coverage throughout life’s many changes.
Here’s why regular insurance reviews matter:
1. Life Changes Can Create Coverage Gaps
Major life events, such as marriage, divorce, the birth or adoption of a child, buying a home, career shifts, or retirement, can drastically alter your insurance needs. What fit your situation even just a year ago may leave you underinsured or, alternatively, paying more than necessary. Regular reviews ensure your coverage keeps pace with your evolving life.
2. Policy Terms and Premiums May Change
Insurance providers periodically update policy terms, and premiums can rise or fall based on industry trends, claims history, or your changing risk profile. A review gives you the opportunity to catch and address increases or unfavorable changes before they impact your wallet or the adequacy of coverage.
3. Discover New Options or Discounts
The insurance marketplace is always evolving, with insurers introducing new products or discounts. Routine reviews can help you identify better value policies, or new add-ons that didn’t exist when you last purchased coverage, potentially saving you money and providing more comprehensive protection.
4. Keeping Pace with Asset Growth
As you accumulate assets, whether that’s real estate, investments, or personal valuables, your existing coverage may no longer be sufficient. Reviewing your insurance ensures that everything of value is adequately protected and that you are not exposing yourself to unnecessary risk.
5. Regulatory and Legal Changes
Insurance regulations can change at the state or federal level, directly affecting required coverages (such as auto liability minimums or health insurance mandates). Regular reviews help you comply with legal obligations and avoid fines or invalidated coverage.
6. Peace of Mind
Knowing that your insurance coverage is up to date provides peace of mind, allowing you to focus on life and work without fear of being blindsided by unanticipated gaps in coverage should a crisis or unexpected event occur.
How Often Should You Review?
As fiduciary financial advisors, we recommend having your insurance policies reviewed at least once a year or immediately following any major life change. A quick annual review could be the difference between financial stability and costly surprises. This applies to all types of insurance: health, life, auto, homeowners/renters, disability, and long-term care.
Final Thoughts
Neglecting to review your insurance can leave you exposed to expensive surprises. It might even result in you paying for more coverage than you need. Periodic insurance reviews safeguard your financial well-being and ensure your coverage aligns with your current needs and goals. Don’t leave your peace of mind and financial security to chance, make insurance reviews are part of your financial routine.
At Copper Leaf Financial we work closely with our clients to ensure that your insurance provides you with the proper amount of protection and reflects your specific goals and objectives identified in your wealth management plan.
By Ashlee Solarczyk, CFP®, CWS®, Senior Wealth Advisor
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Recipients should not act on the information presented without seeking prior professional advice