Insurance coverage can be easy to neglect until something happens to remind you of the important protection it provides. If you can’t remember the last time you reviewed your auto, home and life insurance policies it’s time to schedule a checkup to determine if you need to make changes or if there’s a cost savings.
Understand your auto insurance coverage
Check to see if you’re over- or under-insured on your auto insurance. Auto insurance has three parts—liability, collision and comprehensive. Liability is the most important and is required coverage in North Carolina. In the event of an accident, liability coverage protects you if you’re at fault, you hurt someone or damage their property. Liability coverage includes bodily injury and property damage.
The minimum vehicle liability coverage amounts required in North Carolina are:
• $25,000 for property damage per accident
• $30,000 for bodily injury per person
• $60,000 total for bodily injury per person in an accident
Collision and comprehensive insurance are both optional coverages but can be good preventive measures. Without this added coverage, you could drain your savings trying to cover damages to your car.
If you were to damage or total your car in an accident, collision coverage helps you pay for needed repairs or a vehicle replacement. Comprehensive coverage exists to help cover damage caused by circumstances not related to an accident (e.g. theft, hitting a deer or automobile fire).
The minimum liability amounts may not be enough if you’re involved in a serious accident, so consider buying more. If you’re worried about your ability to pay for comprehensive and collision coverage, shop around. In addition, you can potentially save on your premiums by raising your deductibles rather than reducing coverage. But make sure the higher deductibles won’t be too difficult to pay if you do have an accident.
Another good reason to review is to see if there are costs savings. If you’ve added an alarm or park in a garage at home, you could save big on auto insurance coverage. Other triggers include life events such as a change in marital status; change in living arrangements (e.g. roommate moves in or out); addition/deletion of a teen driver or if you’ve bought or sold a car. Of course, policy renewal time is a great opportunity to review your coverage needs. Contact different agents to compare car insurance quotes.
Check on your homeowners insurance
Knowing your home and valuables are covered if disaster strikes, means less worry about replacing what was lost. Keep in mind, the cost to replace your home today could be more than the original purchase price. You’ll be much better off if your homeowners policy provides replacement cost of the structure rather than actual cash value.
Consider a separate rider to cover expensive items and other valuables that exceed the basic policy coverage. You may even need to add a business rider if you or your spouse maintain a home office. Again, make sure you can afford the premiums on such a robust policy.
Added a security system? Is your policy ready for renewal? Ask your insurance representative how changes like these may lower your homeowners insurance rates.
Keep life insurance coverage current
Is your current coverage enough to meet your family’s needs in the event of your death? Generally, the more dependents you have, the more life insurance you need. On the other hand, if your children are grown, you may realize you no longer need to carry as much coverage.
Your insurance needs may change with major life events (e.g. marriage, caring for an elderly parent, a home purchase, promotions or new employment) so it’s best to review the policy whenever you have a life event to determine the need for updates.
Have you lost weight or quit smoking? Are you the caretaker for your aging parents or loved one? If you’ve had a change in your marital status or had a baby or adopted a child, it’s time for a life insurance policy review. These may be triggers that could change the coverage amount you may need.
When you’re ready to review any of your insurance policies, LGFCU can help. If you’re a member, you can get a home and auto insurance quote, or life insurance quote from TruStage Insurance at no cost to you.
Take a minute now to think about the status of your insurance coverage to see if you’re under- or over-insured, or if you’re missing out on money-saving discounts.
The advice provided is for informational purposes only. For additional guidance, contact an Insurance Representative. Auto, homeowners and life insurance is underwritten by TruStage Insurance. This insurance is not a deposit and is not federally insured or guaranteed by your Credit Union. Insurance representatives are licensed in N.C. only.
This article originally appeared August 2018.