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Insurance premiums are rising, and a recent Trusted Choice survey found that 70% of Americans are actively reviewing their insurance policies to save money.
FOX Business asked insurance experts why January is the best time to review your insurance plan and consider ways to save money.
Why you need to evaluate your insurance coverage this month
January is considered the best month to review your insurance coverage policy for certain reasons.
“First, it's the start of a new year, which is a convenient time to assess your financial and personal situation,” said Matt Simon, president of CoverLink Insurance. “During the past year, you may have experienced changes in your life or financial circumstances that may affect your insurance needs.”
Nearly 70% of Americans are reviewing their insurance policies for lower rates: The Trusted Choice
He also said that many insurance policies are renewed annually, so January is the best time to check whether your insurance fits your current needs and circumstances.
Couple checks important documents at home. (image/image)
The third reason is that many people are preparing or reviewing their annual budgets, and the cost of insurance is often a large expense, so January is a time to not only review your costs but also to make sure that the coverage you purchase is tailored to you. Simon says this is the perfect time to make sure your wishes are met. needs.
Are there specific coverages that should be a priority for consumers?
According to Simon, preferred coverage for consumers typically includes:
– Car insurance: Covers potential accidents and liability on the road.
– Homeowner or renter insurance: Protect your home and personal property.
– Umbrella Liability: Provides an additional layer of liability protection when your underlying home, renters, auto, etc. insurance is insufficient to cover a claim.
– Life insurance: To provide financial security to your loved ones who depend on you.
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How do external factors such as natural disasters and supply chain issues impact current policies?
Nancy Jarmond, executive director of risk management and education at Independent Insurance Agents & Brokers of America, said a variety of external factors can affect insurance contracts, and many Consumers said they are feeling the impact in higher premiums even if they haven't experienced a claim.
“External factors such as natural disasters or supply chain issues can impact insurance contracts in a variety of ways,” he said. “For example, if you live in an area prone to hurricanes or wildfires, your property and casualty insurance premiums and deductibles may increase.”
Flood insurance is also a big issue, she said, due to expected weather changes and the potential for adjacent flooding from wildfires.
“Standard homeowners insurance does not cover flooding,” Jarmond said.
Insurance Information Institute spokeswoman Loretta Waters said if you live in a flood-prone area of the country, it's essential to have flood insurance.
If you live in a flood-prone area of the country, it is essential to purchase flood insurance. (Photographer: Nathan Howard/Bloomberg via Getty Images / Getty Images)
“Homeowner's insurance does not cover flooding, but flood insurance is available through the federal government's National Flood Insurance Program and from private insurance companies,” she said.
What life events would cause you to review your insurance coverage?
According to both Jarmond and Simon, these events include:
– Marriage or divorce
– Birth or adoption of a child
– Purchasing a home or making renovations such as renovating the kitchen or adding a room
– Changes in employment or income
– Significant medical condition or change in health condition.
– retirement
– Acquisition of valuable assets or investments
– Starting a business, including a home business
– When family members move in and out of the home, or when a family member dies and the property is left vacant or in trust.
– Young drivers will be added to your insurance
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Given the rising costs, is it advisable to bundle insurance?
Simon said bundling multiple insurance policies, such as car and home insurance, can often lead to cost savings through discounts offered by insurance companies. However, he cautioned that it is essential to review the individual policies within the bundle to ensure they meet your needs and offer a competitive price.
“It's important to assess the details of your insurance requirements, as it's not always recommended in every situation,” Simon added.
