Are You Adequately Insured?

Unfortunately far too many homeowners are not carrying adequate insurance coverage in the event of a disaster. Reviews which are conducted regularly vary in their assessment of the problem but the majority agree that about two-thirds of all properties do not carry sufficient insurance and that, on average, these properties are under-insured by around about 20 percent.

Generally of course you do not notice that you have insufficient insurance until tragedy strikes by which time it is already too late. In states such as California, in which wildfires are not uncommon, many families were stunned after the latest round of fires to find that when it came to rebuilding there was insufficient money to replace their homes.

The problem here does not only involve the total sum for which you are insured but also extends to the sort of cover you have. For instance, you might be astonished to learn that many the victims of Hurricane Katrina reported that they had been advised by their insurance agents that they did not require cover for flooding.

Why then are so many people carrying too little insurance? After all, surely it ought to be in the interest of insurance agents, who are the experts in this particular field, to make certain that their clients are properly covered, not merely to safeguard their own reputations but also because they are generally paid a percentage of each policy the sell.

The answer alas is simple. Far too many property insurance agents work on volume and so do not bother to take the time to ensure that you have the right policy for your property but just sell you whichever plan they can as quickly as possible so that they can move on to the next customer. Also, the market these days is very competitive and so a lot of agents would rather sell you a policy at a lower premium and with less cover than you require than risk you purchasing from somebody else.

Like many things in life you get just what you pay for when it comes to homeowners insurance. You can reduce your monthly costs by going for a low sum assured and by excluding certain types of cover but is it wise to do so?

For almost all of us our homes are the single most expensive investment we will ever make and our lives, together with those of our family, could literally be shattered if we are unable to replace our home when disaster strikes. Also, in case you believe it could not possible happen to you, just cast your mind back to the many heart rending stories that you have heard recently from the victims of hurricane Katrina and the folks affected by the California fires.